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Elena Watson
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Traders Fair
July 29 10:29

How did the Bull and Bear Market Get Their Names?

While the terms are relatively simple to understand, the impact either a bull or bear market can have on your portfolio and wealth is massive.
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The terms "bear" and "bull" are often used to describe general actions and attitudes, or sentiment, either of an individual asset or the market as a whole. Investors use the terms "bearish" or "bullish" as a quick way to describe their market sentiment regarding specific securities or financial markets. A bear market refers to a decline in prices, usually for a few months, in a single security or asset, group of securities, or the securities market as a whole. In contrast, a bull market is when prices are rising. Typically, a move of 20% or more from a recent peak triggers an "official" bear or bull market.
A bull market is a market that is on the rise and is economically sound, while a bear market is a market that is receding, where most stocks are declining in value. The actual origins of these expressions are unclear, but one reason could be that bulls attack by bringing their horns upward, while bears attack by swiping their paws downward. A second explanation relates to early stock market participants and how they could benefit from either an up or down trend.
A secular bull market and a secular bear market are terms used to describe long-term patterns of wealth creation or destruction in a stock market above and beyond regular volatility, especially when accounting for purchasing power changes due to inflation or deflation. Both animals are known for their incredible and unpredictable strength, so the image that each evokes in regards to stock market volatility certainly rings true.