Bull Market Meaning with Example
Bull Market Meaning – A situation in stock market when prices are rising for several months.
The term bull market is usually used to describe the stock market. However, people also use these terms for describing rise in the prices in the specific sectors such as real estate, foreign exchange, bonds, currencies, commodities, etc.
Bull market run on the optimism that prices will go up. In this period of time, investor does have high confidence regarding the rise in the prices of the stock. The market is characterized with buying of securities. On the other hand, bear market runs on pessimistic thinking that prices will fall. Here investor hesitate to invest. This market is characterized with selling of securities.
Bull Market Vs. Bear Market
Bull market implies that price of stock will rise in the near future. Whereas Bear market indicates the falling of the prices in the future. In case of bullish market, buying of shares in large volume takes place. On the other hand, bearish market situation leads to selling of stock in large volume.
The word ‘bull’ and ‘bear’ comes from the way these two animals attack. When it comes to bull, it attack with its horn keeping the head upward. While bear attack with paws and his head is always downward at the time of attacking its prey. So, when the market is rising it is known as bullish trend and when the prices are falling, it is known as bearish trend.
Bull Market Example
To get a deeper understanding of bull market meaning, let’s discuss an example.
Well, it is very difficult or you can say a very tricky task to identify whether the market is following bullish trend or bearish trend. According to analysts when the 80% of the stock prices rise and remains for a period of more than 6 months or when the market index increases by 15 percent, then at that time, market can be referred to as bull market.