Why bear and bull

So if you are bearish, it means you think the price of an asset or market will go down. A similar definition — but in the opposite direction — applies to bear markets. Some market analysts argue for more thoughtful definitions of bull and bear markets that take into account underlying conditions and span a wider period of time.

Bulls are optimistic about asset prices, while bears are pessimistic. But where do the terms come from? No one really knows for sure. But one theory is that they come from a rather grisly bloodsport — popular in both Elizabethan England and gold rush era California — in which a bull would be pitted against a bear. Spectators would bet on the outcome. A bull market means the share market is rising and investor sentiment is confident, further encouraging other investors to buy.

Essentially a bear market is the opposite of a bull market. A bear market is generally marked by investor pessimism which can cause prices to continue falling, adding to further negative sentiment. Sometimes a steep fall in market prices can be a market correction rather than a bear market.

However, whereas a bear market is usually a sign of negative investor sentiment, a market correction is often a temporary price reversal before the market continues moving upwards. Investors are often categorised as bulls and bears. The information on this website has been prepared without taking account of your objectives, financial situation or needs. Because of this, you should consider its appropriateness, having regard to your objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

Nooks and crannies. Semantic enigmas. The body beautiful. Red tape, white lies. Speculative science. This sceptred isle. Personal Finance. Your Practice. Popular Courses. Part Of. Introduction to Bear Markets. How to Invest in Bear Markets. Bear Market Trading Tactics. Bear Market Risks and Considerations. Investing Markets. Table of Contents Expand. Why "Bulls" and "Bears"?

Literary Evidence for Bear. Literary Evidence for Bull. Key Takeaways 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.

Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.