22 June 2021

Bull Market vs Bear Market

By DICC Institute

The stock market of any country is one of the most important aspects in the world just like the heartbeat which is important for the survival of the human being. The market can even be described as volatile in many possible cases and that is the reason it depends on various possible circumstances. You must already be aware of the stock market position as sometimes it goes up while some other time goes down which in financial term referred to as a Bull market as in here the general market scenario is quite upbeat and always in the position of rising. While on the other hand if the market is to moving downward then the market is referred to as a Bear market. Both the terminologies used here to describe the market is quite different. Well, the whole idea is based on the way each of these animals attacks their respective opponents. If we see the bull then it mainly thrust its horns in the air whereas in the case of bear it normally stamps its pawn down on its prey.

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A bull market only takes place when the economy is kind of smooth, the GDP of the economy is on the rise and apart from these two things the job creation is also in the verse of rising. All these things are necessary for the bull market as the selection of stocks here becomes more comfortable as the whole in here is in a stable position. If an investor is kind of optimistic then he is mostly advice to have a bullish outlook as that may help his position in the stock market a lot. But if we see the bear market which is the opposite as in here the economy is under a recessionary phase which is over a long period and the stock market is quite plummeting and that too rapidly. Apart from this the selection of the stock becomes a difficult task and the investor mainly focus on making money by selling all the possible stocks which are also known as short selling. Thus, an investor who has a pessimistic option is called someone who more likely to have a bearish outlook. These types of people anticipate to have to create such a situation which is temporary and that indicates of the revival stage which indicates being around the corner. Now let’s try to discuss both these markets briefly.

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What is a Bull Market?

This is a marketplace situation which is defined as a place whereby the prices of the listed securities which in continuous rise due to some favourable macroeconomics scenarios or some improved internal circumstances of the film or sector. In simple language, we can say that the technology applies to the stocks. Apart from that, it is also referred to other asset class such as Bonds, FOREX, Commodities etc. Even as per the law been carried out in finance market the demand as well as supply influence the market. Here if the supply of stocks falls when prices in the financial market are increased and vice versa. The market can be simply be defined as a marketplace where the actual price of the securities mainly goes up or is anticipated to go up over a period. In this type of market, buying option is encouraged as most of the condition is in favour. Some of the basic features of this type of market are that they are optimistic, have higher returns, high stock trading, and investor confidence. Those investors who always expect the rise of price are called bulls and the sentiment carried out is known to be bullish.

Features of Bull Market

  1. The market which is having the nature to grow aggressively over some time
  2. The outlook here is optimistic
  3. The market mainly takes a long position
  4. The response of the investor is always positive
  5. Apart from this, the prices of stocks are high in case of a bull market
  6. The concept of stock trading is high
  7. In a bull market scenario, the economy of the country mainly grows
  8. The market indicators are kind of strong

What is a Bear Market?

This is a financial market that is often characterized by a constant fall in the prices of the very securities is known as the bear market. Apart from this the market is pessimism is quite prevalent and the investor takes a short position. This is all due to the anticipation of loss which is created by holding them as the security is been sold by an investor. In the stock market, the stock trading mainly declines, the returns are low, the investor confidence is always negative and low and all this is often accompanied by the recession of the economy. Those investors who mainly expect the prices to fall is called bears and the sentiment been carried here is known as bearish.

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Features of Bear Market

  1. The market here refers to a place where there is constant consideration of the fall month on month
  2. The outlook here pessimistic
  3. The investor response is negative
  4. The prices of stock in here
  5. The concept of stock trading here is less
  6. In a bear market scenario the economy of the country mainly declines
  7. The market indicators in the case of a bear market are kind of weak  

Conclusion:

I hope all the information shared above will be useful to all my readers

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