Definition of Bear Market

What is a Bear Market?

There is no single definition of a "bear market" that is accepted by everyone.

A bear market means different things to different people.

The "standard" definition that is used by most is that a bear market comes when multiple major indexes drop by at least 20% over a minimum of two months.

 -- definition of a financial term - bear market - what is? --In a "correction", major indexes would drop substantially over a shorter period of time. A bear market is more of a prolonged slump that is marked by "bear market rallies" and steady doses of bad market news. A bear market is marked by investor apathy and a steady decline in major market indexes. A correction, on the other hand, is a smaller decline that comes over a shorter period of time in an asset or index that is in an uptrend.

Example: 2008. 2008 is the perfect example of a "bear market". A long, prolonged decline in all of the major market indexes (DJIA, Nasdaq, S&P 500). Incredible investor apathy that has led many to exit the markets altogether. Shrinking corporate earnings. A steady drumbeat of bad news for the markets. Major declines in all of the major indexes (at least 30%+) with many investors openly wondering when things will ever turn around.

Past Examples of Bear Markets: 1929-1932 (Great Depression), 1937-1938, 1973-1974, 2001-2002, 2008+

-- Articles That Mention Bear Market:

Waiting For a Market Crash? You'll Likely Need a Euphoric "Melt-Up" First

Markets Bounce Back Following Historic Rout

Proactive Fund Investor Newsletter Review

Will 2009 End Up Being Similar to 1930?

Founder of Elliott Wave International Inc. Predicting Major Crash In US Equities