Bear Market

Bear market

Any market in which prices exhibit a declining trend. For a prolonged period, usually falling by 20% or more.

---

Bear Market

A situation in which a large number of indices lose a significant percentage of their value over the medium or long term. While there is no hard-and-fast definition of a bear market, many analysts consider a 20% loss in the Dow Jones Industrial Average or the S&P 500 to be a good rule of thumb. It is difficult to make a positive return on stocks during a bear market, and some investors move into bonds. This leads to the sale of more stocks, and the bear market can become self-sustaining. Technical analysts attempt to find the bottom of bear markets and identify buy signals, but this is risky. A bear market is different from a recession, but one can lead to the other. See also: Bull market.

---

bear market

An extended period of general price declines in an individual security or other asset, such as silver or real estate; a group of securities; or the securities market as a whole. Nevertheless, even during widespread bear markets, it is possible to have bull markets in particular stocks or groups of stocks. For example, stocks of gold-related companies often move against major trends in the security markets. Compare bull market.

---

Bear market. A bear market is sometimes described as a period of falling securities prices and sometimes, more specifically, as a market where prices have fallen 20% or more from the most recent high.

A bear market in stocks is triggered when investors sell off shares, generally because they anticipate worsening economic conditions and falling corporate profits.

A bear market in bonds is usually the result of rising interest rates, which prompts investors to sell off older bonds paying lower rates.

---

Bear Market

What Does Bear Market Mean?

A market condition characterized by falling stock prices, widespread pessimism, and snowballing negative sentiment that causes investors to sell stocks; this leads to further pessimism. Although figures vary, a downturn of 20% or more across broad market indexes such as the Dow Jones Industrial Average (DJIA) or the Standard & Poor's 500 Index (S&P 500) over a two-month period is considered a bear market.

Investopedia explains Bear Market

A bear market should not be confused with a correction, which is a short-term trend that lasts less than two months. Although corrections are often a great time for a value investor to jump into the market, bear markets are quite risky to time because one never knows when a market has hit bottom. It is difficult for investors to make money in a bear market unless they are short sellers.

Related Terms:
• Bull Market
• Downtrend
• Market Economy
• Short Sale
• Stock Market