Entity: BEAR-MARKET
A bear market refers to a sustained period of falling stock prices, typically defined as a 20% decline from recent highs. The term originated from speculators known as 'bears' who bet on price drops. It signifies a lack of optimism in the market and a downward trend.
BEAR MARKET
Etymology
The term 'bear market' likely originated from speculators known as 'bears' who bet on price drops. It may have stemmed from an old proverb about selling a bear's skin before catching the bear.
Definition
A bear market is a prolonged period of declining stock prices, typically defined as a 20% or more drop from recent highs. It reflects pessimism, lack of investor confidence, and a sustained downward trend.
Historical Context
Bear markets have been a recurring phenomenon in financial history, often associated with economic downturns, recessions, or periods of uncertainty. Understanding the historical context of bear markets can provide insights into market cycles and investor behavior.
Cultural Significance
Bear markets are closely watched by investors, economists, and policymakers as they can impact investment strategies, retirement savings, and overall economic sentiment. The cultural significance of bear markets lies in their ability to shape financial decisions and market dynamics.
Related Concepts
- Bull Market: Contrary to a bear market, a bull market is characterized by rising stock prices and optimism in the market.
- Correction: A correction refers to a temporary reverse movement in stock prices, typically a 10% decline from recent highs.
See Also
- Stock Market
- Market Cycle
- Investor Sentiment
A bear market is a prolonged period of declining stock prices, characterized by a 20% or more drop from recent highs, reflecting pessimism and a lack of investor confidence.