"Everyone's a genius in a bull market."
Volatility: The Great Equalizer
When markets keeping rising month after month, everyone starts to look like a genius. Strategies that should have failed survive. Portfolios that ignored risk flourish. Traders confuse luck for skill. Traders who were simply along for the ride begin to believe they have unlocked the secret of the market
In bull markets, it’s not intelligence that stands out, it’s participation.
Even the most novice investor can appear to be a market genius. Their portfolio surges, their hot tips go viral on social media, and suddenly they’re giving stock advice at dinner parties.
Volatility: The Great Equalizer
This pleasant feeling only lasts as long as the uptrend does. The illusion of being a genius fades fast when volatility returns. The same traders who claimed trading was easy suddenly discover harsh drawdowns. Drawdowns that once seemed impossible arrive and prices dip to levels you never thought possible before.
Bull markets don’t test your models; bear markets do.
Historical Examples: When the Party Ended Abruptly
The S&P 500’s history is littered with moments that stripped away the illusion of easy gains.
2000–2002: The dot-com bubble burst, erasing nearly 50% of the index over three years.
2008: The global financial crisis sent the S&P 500 down -38%.
2018: A seemingly unstoppable bull run cracked in Q4; the S&P fell -9.2% in December alone — its worst month since 1931.
March 2020: COVID panic wiped out 34% in 33 days.
2022: Rising inflation and rate hikes ended the post-pandemic euphoria with a -19.4% annual decline — the worst year since 2008.
What Endures
Lasting success in markets comes from surviving the other side of the cycle. A true edge isn’t visible when everything goes up; it’s revealed when nothing does.
Smart in a bull market? That’s easy. Still smart when the party ends? That’s rare.
At CI Volatility, we build for the rare.