Tag: Bear Market

A bear market refers to a financial market condition characterized by a prolonged decline in the prices of securities, typically by 20% or more from recent highs. This term is most commonly used in the context of stock markets but can apply to other asset classes, such as bonds, currencies, or commodities. Bear markets often arise during periods of economic downturn, increased unemployment, and declining consumer confidence, leading to a negative sentiment among investors. The term is contrasted with a “bull market,” which denotes rising prices. Investors in a bear market may adopt a more cautious approach, often holding onto cash or investing in safer assets to protect against further losses. Bear markets can be temporary or last for extended periods, and they are considered a natural part of market cycles, reflecting the ebb and flow of economic conditions.