What is Bear Market?

A bear market is when stock prices fall 20% or more from a recent high, sustained over at least two months. It's the market's way of humbling everyone who got too comfortable during the bull run. Investor sentiment turns negative, media coverage turns apocalyptic, and your portfolio turns a shade of red you've never seen before.

On average, bear markets last about 9–10 months — though they feel much longer when you're living through one. The longest modern bear market lasted about 2.5 years (2000–2002 dot-com crash). The shortest was in 2020, lasting just 33 days before the Fed printed enough money to make everyone forget it happened.

A correction is a 10–20% decline from a recent high — a polite warning from the market that you got too excited. A bear market is 20%+ and usually involves real economic deterioration, not just profit-taking. Think of a correction as a cold; a bear market is pneumonia.

The textbook answer: stay calm, keep investing via dollar-cost averaging, and don't sell at the bottom. The real-world answer: most people panic-sell near the bottom, then buy back in near the next peak. If you can resist that urge, you're already ahead of the majority of retail investors.

Bear markets are typically triggered by some combination of: rising interest rates, economic recession, high inflation, geopolitical shocks, or a bubble popping. Sometimes all of the above at once, because the market enjoys efficiency in its destruction.