Question 1

What is the difference between a bull market and a bear market?

Accepted Answer

A bull market is a stretch where prices are generally rising, often defined loosely as a move up of around twenty percent from a recent low. A bear market is a stretch where prices are generally falling, commonly marked by a drop of around twenty percent from a recent high. Both describe a trend, not a fixed event with an exact start and end.

Question 2

What counts as a correction?

Accepted Answer

A correction is usually a drop of roughly ten percent or more from a recent high. It is smaller than a bear market and can happen even while the longer trend is still up. The label describes the size of the pullback, not its cause.

Question 3

Can you time the market and avoid downturns?

Accepted Answer

There is no reliable, repeatable way to call the exact tops and bottoms in advance. The labels for bull, bear, and correction are mostly applied after the fact once the move is clear. This lesson explains why timing is so hard, without promising any outcome.