Let's understand what is bull and bear market?

Published By Ayesha Jaiswal, 15 Sep 2017



Let's understand what is bull and bear market?

Anyone who has invested their capital in the stock market very well understands that their investment amount goes up and down time to time. Do you ever think why?


The stock market is a volatile market and the prices of stocks fluctuate according to the market movements. If you are a stock market investor then surely you are well familiar with the market trends if no then it might be bad for your investment future, because constant success in the stock market requires a clear understanding of the market trends. An investor can refer financial market expert's stock tips and market recommendations for positive results.


Bull and Bear describe the general trends of the stock market. These trends explain the condition of the market for a longer period of time like two or three months.


The stock market can be very complex when stocks are going ups and down. When the market is going up that means it is a bull market and on the other hand when the prices are falling then it's called a bear market.


Bull market -


A market where prices are rising and encouraging buying of stocks. A bull market is a financial market consist of a group of securities in which prices of stocks are increasing or expected to increase. When the market is showing confidence and market indices like the NASDAQ go up too. A total number of stocks traded in the market is also up and even the companies entering in the stock market also increase and show that the market is confident.


The bull market is featured by investor confidence and their strong expectations that positive results should continue. It is quite difficult to ascertain the market consistently when the trends in the market changing continuously. The main problem is that it effects psychologically and speculation sometimes plays an extensive role in the markets.


Bear market -


It is totally different than a bull market. A bear market is the just opposite to a bull. If the market decline by more than 20% then it considered as a bear market. It is a market that shows a lack of confidence among investors. Prices hang at the same price then suddenly go down, in a bear market investors are looking for the bull market to start driving the prices up again and they start expecting that market will go up.


The word "bull" and "bear" use to describe markets is actually coming from the system the animals attack their enemy. A bull market pushes its horns up into the air, and on the other hand, a bear hit its paws downward. These actions simply are the symbols of the movement of a market. So we can say that if the trends are up, it's a bull market and when the trend goes down its a bear market.


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