Market phase reaction test

It measures the difference, not the level

Investor style tests usually fold the answers into one value per person. One scale comes out, aggressive or conservative, how much risk you accept, and that is the end of it. That scale has no axis for market phase. Someone who rethinks only in crashes and someone who makes changes only in quiet markets get the same label.

So this test asks about the three phases separately and counts them separately. The number at the top of the result page is not the value of any one phase but the gap between the highest and lowest of the three. A large gap means you act like a different person when the market changes. A small gap means you keep doing what you were doing even when it changes.

There is no conclusion that one is better. A large gap can mean you respond to circumstances, and it can also mean your standards move often. What this test does is go as far as showing in which phase the gap arises.

No option is right or wrong

Each question has two options: one keeps to what you decided, the other makes changes to fit the situation. Neither is the right answer. Sometimes closing out a stock whose price fell is right and sometimes leaving it is right, and this test does not judge between them.

The options carry no mark showing what each counts toward. When a mark is visible, people answer with what they were taught they should do rather than what they actually do. The phase names, though, are not hidden. Each question already says what kind of market it is, so hiding them would hide nothing.

How the reaction score is calculated

There are 4 questions per phase, 12 in all. The number of times you choose the option that makes changes in a phase becomes that phase’s reaction score, converted to a percentage. With 4 questions, the value moves only in steps of 25. Answering one question differently moves that phase’s value by one step, and this coarseness is noted on the result page too.

The questions from the three phases are mixed. If questions from the same phase came one after another, people would match later answers to earlier ones and the phase values would spread further apart than they really are. The order is fixed to cycle through surge, crash and sideways once each.

The result page shows the explanation for the phase with the highest reaction score first, and sets the values of all three phases as bars on the same screen. When all three are equal and no highest phase can be chosen, it says so plainly.

The three phases

When not to trust this result

What this test measures is how you answered the questions, not what you did in your actual account. The two often differ. If you answered that you would hold in the crash questions but have in fact exited, that gap is not caught here.

When you answer also moves the result. Answering the week after a big market drop easily changes the crash answers. Do not read the values as a fixed personality. Answering again after the phase has changed once and comparing the two results tells you more.

The metric priority test measures which numbers you look at first, and this test measures how much those standards move with the market phase. They measure different things, so neither result vouches for the other.