A bull market describes an environment where security prices rise for an extended period. Generally, bull markets are characterized by investor confidence that the upward trend in prices will persist. As investors continue to buy, they in turn drive up security prices.
What is a bull market?
- A bull market describes an environment where security prices rise for an extended period. It is often characterized by investor confidence or optimism.
- A bull market can describe any environment where security prices are rising, but it commonly refers to the stock market.
- A bull market is not the same as economic growth or expansion.
A common definition of a bull market is an increase in stock prices of at least 20%, commonly measured by the S&P 500 in the United States. However, a bull market can refer to rising prices of securities other than stocks.
While the two often go together, a bull market is not the same as economic growth. A bull market describes a sustained increase in prices within the securities market, while economic growth describes an increase in a country’s economic output.