Equities
Bear Market
A bear market reflects sustained selling and a shift in sentiment toward fear. The 20% decline from a peak is the widely used definition, distinguishing it from a shorter, shallower correction.
Bear markets often accompany recessions, rising rates, or shocks that damage confidence. They can be painful, but they also reset valuations and sow the seeds of the next recovery.
Because markets recover over the long run, seasoned investors treat bear markets as opportunities to buy quality assets at lower prices rather than reasons to abandon a sound plan.
Example
When a major index falls more than 20% from its high, it is officially in a bear market.
Bear Market — FAQ
What is Bear Market?
A bear market is a prolonged decline in asset prices, commonly defined as a drop of 20% or more from a recent high, marked by pessimism and falling demand.
Can you give an example of Bear Market?
When a major index falls more than 20% from its high, it is officially in a bear market.
Understanding creates conviction.
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