ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -When the economy is on the back foot, investors tend to be pessimistic and stock prices decline. Economists define a bear market as a decline of 20% or more of a major stock market index, such as the DJIA or S&P 500, for a sustained period.

Detailed explanation-2: -So they sell stocks, pushing the market lower. A bear market can signal more unemployment and tougher economic times ahead. Bear markets tend to be shorter than bull markets-363 days on average-versus 1, 742 days for bull markets.

Detailed explanation-3: -While bear markets are unnerving, they can also be fantastic buying opportunities. If you’re looking to load up on high-quality stocks for a fraction of the price, now is the time to invest. However, it’s one thing to simply buy stocks; it’s another to ensure they survive a market downturn.

Detailed explanation-4: -Summary. Bear markets are typically accompanied by recessions, but not always. The ones that are not are shorter and shallower.

Detailed explanation-5: -Believe it or not, the term “bear market” originates with pioneer bearskin traders. The country’s early traders would sell skins they’d not yet received – or paid for. Because the traders hoped to buy the fur from trappers at a lower price than what they’d sold it for, “bears” became synonymous with a declining market.