Investing Basics

What Is a Bear Market?

A bear market is a sustained period when stock prices are falling, commonly defined as a decline of 20% or more from a recent high. Bear markets often accompany economic slowdowns or recessions, though not always. A smaller decline of 10% to 20% is usually called a correction.

Recovering From a Decline

Because percentages are measured from different bases, a 20% fall requires a 25% gain to return to the previous level.

History

Bear markets have historically been shorter on average than bull markets, though their length and depth vary widely.

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Bull Market Recession Volatility Risk Tolerance

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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.