What is a Bear Market?
The bear market gets its name from the way
Hi, I'm Robin Young of Women Behaving Wealthy for About.com. Today we will discuss what is a bear market?A bear market describes a market condition in which the prices of securities are falling generally by 20% or more over a period of time. It is symbolic of a market trend of decline.The causes and characteristics of bear markets vary. Economic and investor sentiment both play a role in the creation and momentum of bear markets. In general a weak or weakening economy, high unemployment, and declining business profits usher in a bear market. A bear market is also characterized by widespread pessimism resulting in investors selling shares in order to avoid losses. This negativity causes people to sell, which in turn causes more doubt about the market's stability.The use of “bear” to describe a market originated from the way the bear attacks its opponents. A bear swipes its paws down, which is a metaphor for a downward market trend.Thank you for watching. For more information, please visit About.com.
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