Bull Market

When assets are steadily rising over a period of time, it is known as a "bull market." The Securities and Exchange Control Commission defines a bear market as a period of at least two months when a broad market falls by 20 percent or more. When it rises by 20 percent or more over two months or more, it is a bull market. A milder form of a bear market is "correction." During a correction, prices drop by 10 to 20 percent from the previous peak. There have been fewer bull markets: 24 since 1928. They tend to last a lot longer, though, often for multiple years. A bear market may signal a recession is coming, though it's not a perfect correlation. Since World War II, there have been three bear markets out of a total of 12 that didn't precede a recession. But a bear market is bad news for anyone who invests in stocks. The impact is particularly hard on recent retirees, who are seeing their nest eggs shrink just as they need to start withdrawing income from them.