Bear Market

Definition

A bear market is when a market experiences prolonged price declines. It typically describes a condition in which securities prices fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment.

Example

The 2008 financial crisis triggered a significant bear market where major stock indexes around the world dropped by more than 30%. The sharp, brief market downturn at the start of the COVID-19 pandemic in early 2020 is another example.