Bull Markets, Bear Markets & Corrections
The vocabulary of rising and falling markets, and roughly how often each happens.
Markets move in long mood swings, and there’s a vocabulary for them. Knowing it keeps you calm when headlines panic.
- Bull marketSustained rising (bull) or falling (bear) market phases. — a sustained rise, optimism, prices making new highs. Bulls thrust their horns up.
- Bear marketSustained rising (bull) or falling (bear) market phases. — a fall of 20%+ from the peak, pessimism, fearThe two emotions that move markets and ruin accounts.. Bears swipe their paws down.
- Correction — a shorter, sharper drop of 10–20%, common and healthy.
- Crash — a sudden, steep fall in days or weeks.
Here’s the part that matters: corrections of 10% happen roughly once a year, and 20%+ bear markets every few years. They are not anomalies — they are the toll you pay for equityA unit of ownership in a company.’s long-term returns.
Bear markets feel like the end of the world and have, so far, always been the start of the next bull marketSustained rising (bull) or falling (bear) market phases.. The investors who do best are simply the ones who don’t sell at the bottom in fearThe two emotions that move markets and ruin accounts..
Key takeawayBull = sustained rise, bear = 20%+ fall, correction = 10–20% dip. Declines are normal and recurring, not signs to flee.
FAQs
How long do bear markets last?
Historically, equity bear markets have ranged from a few months to a couple of years, and markets have recovered to new highs afterward every time so far. Their depth and length vary, which is exactly why timing them is so hard.