![]() ![]() Like bull markets, bear markets can be categorized as secular or cyclical. Low economic stability and high unemployment, low gross domestic product, and low corporate profits are traditionally thought to correlate with the downturns associated with a bear market. There’s no formal metric to measure when a bear market is happening, but a 20% decline in prices is sometimes used as the threshold.Īs you might expect, bear markets result from the opposite of the conditions thought to constitute or correlate with bull markets. Like bull market, the term usually refers to the stock market, but it can also be used in the context of real estate, currencies, and other commodities. One explanation for the use of the word bull in bull market likens the upward swing of a bull market to the motion in which a bull may attack-by throwing its horns upward.ĭo you know the difference between a recession and a depression? What is a bear market?Ī bear market occurs when prices are falling, or when they’re expected to decrease. In general, the bull is associated with aggression and is known to charge forward, like a rising market. The origin of the use of the word bull in this way is uncertain. The first records of bull market and bullish in the context of finance and the stock market come from the late 1800s, but the noun use of bull in the context of stock investment-to refer to both a type of an investment and an investor-predates both. In the context of stocks and finance, the related adjective bullish can mean “rising in prices,” “characterized by favorable economic prospects,” or, more informally, “regarding a particular investment as potentially profitable,” as in We’re still bullish on treasury bonds.Īs a noun, bull can refer to a person who believes that market prices, especially of stocks, will increase. High employment rates, high gross domestic product, and other measures of economic well being and stability are generally thought to correlate with bull markets.īull markets are often categorized as secular (indicating a period of growth lasting more than five years) or cyclical (indicating a shorter-term period of growth). Usually, a bull market happens when the economy is strong or getting stronger. Still, a 20% increase in prices is often used as the ballpark figure that indicates a bull market. Using the term bull market is informal-there’s no formal metric to measure or determine when a bull market is happening. ![]() The terms bull market and bear market are most closely associated with the stock market, but they can also be used in the context of other markets, including those for real estate, currencies, and other commodities. In discussions of the stock market and the greater economy, the term bull market is typically applied when prices on average are on the rise, or when they’re expected to rise. At any given time, the market is usually described as one or the other-with bull and bear markets alternating as part of an ongoing cycle. A bear market is the opposite-one in which prices are falling. The term bull market is applied to a market (especially a stock market) in which prices are, on average, rising. ![]()
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