Bear Market
A sustained decline in prices of 20% or more from a recent high. Pessimism and selling pressure dominate.
A bear market is a prolonged period of falling asset prices — conventionally a decline of 20% or more from a recent peak. Bears are pessimistic and expect prices to continue falling.
Bear markets are typically triggered by economic recessions, rising interest rates, geopolitical shocks, or the collapse of speculative bubbles. They are characterized by high volatility, low investor confidence, and rising short interest.
Bear markets tend to be shorter but sharper than bull markets. On average, US equities bear markets have lasted about 9–12 months, compared to several years for bull markets.
Related Terms
Bull Market
A sustained period of rising prices, typically defined as a 20%+ gain from a recent low. Optimism and buying pressure dominate.
BeginnerIndex
A benchmark measuring the performance of a selected group of securities — the S&P 500 tracks 500 large US companies.
BeginnerShort Position
Borrowing shares and selling them, hoping to buy them back cheaper. Profit when the price falls; loss when it rises.
IntermediateVolatility
The degree of price variation over time. High volatility means bigger swings — more opportunity and more risk.
Intermediate