What is a Bear Market?

The term Bear Market refers to a phase in which financial markets experience a sharp and prolonged decline in prices, often defined as a drop in asset values of 20% or more from their peak levels, and this trend lasts for a relatively long period.

Why is it called a “Bear Market”?

The term “bear” is used because the bear, when attacking its prey, uses its claws to strike it from top to bottom, which indicates a downward movement in the market. Conversely, a rising market is called a “Bull Market,” named after the bull that attacks by thrusting its horns upwards.

Characteristics of a Bear Market:

• General pessimism among investors.

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