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Fincash » Bear Market

Bear Market

Updated on July 14, 2019 , 81 views

What is a Bear Market?

A bear market is a phase of several months or years during which securities prices consistently fall. Bear market is the term typically used in reference to the stock market. But it can also describe specific sectors such as foreign exchange, bond or real estate. In the bear market environment, selling increases and short selling is frequent. During bear market phase, Investing can be risky even for the most seasoned of investors. It is a period marked with falling stock prices.

Bear-market

Many investors opt to sell off their stocks during a bear market for fear of further losses, thus fueling a vicious cycle of negativity.

What Causes a Bear Market?

A bear market occurs when there are more sellers than buyers. In a bear market, for example, the sellers are the supply, while the buyers are the demand. Therefore, when the market is bearish, seller numbers are high and buyer numbers are comparatively low.

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Situations that Cause a Bear market:

Some of the major situations that causes a bear market are:

  • A rapid rise in the Inflation rate
  • High unemployment rates
  • An economy that is entering a Recession
Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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