What is a bear market?
According to the U.S. Securities and Exchange Commission, a bear market occurs when a broad market index falls by 20 percent or more over a period of at least a two months and the outlook is generally pessimistic. The average length of a bear market is 367 days, and they are usually accompanied by recessions—periods when the economy shrinks and unemployment rates soar.
A bear market is defined by falling securities prices that cause
people to continue to sell because they fear a loss. Generally, a
loss of 20 percent or more in two months is considered the
beginning of a bear market.