A bear market is a market in which the general trend is down. If a market is contracting it can be said to have become a bear market, having previously been a bull market. A bear market is seen as a correction to a bull market, bringing prices back to a rational valuation after a protracted period of growth. A bear market can have widespread consequences as value is lost across many different assets, potentially effecting the broader economy, productivity and GDP. A bear market can become a market crash if it precipitates a sudden fall in shares and a mass sell-off of assets. The financial crashes of 1929 and 2008 could be seen as bear markets.
During a bear market some assets might go up, experiencing a bull-run. Gold is seen as a safe-haven during such times and as demand increases it will often rise in value while other assets are contracting.
Sign up to get the latest Glint news
Receive the GLINT newsletter with the most popular content, platform updates and software guides.