In some stock exchanges, unfortunately, share prices dive and continue falling. As a result, this downward spiral encourages pessimism and rampant selling. Some believe that a downturn of twenty percent or more in indices like the Dow Jones Industrial Average or the Standard and Poor’s 500 index over a two-month period signifies entry into a bear market.
For example…
It should come as no surprise that the global financial crisis of 2008 was responsible for a few bear markets. Between the period of October 2007 and March 2009, the Dow Jones Industrial Average or DJIA went down in value by about fifty four percent. However, that’s not as bad as the great Wall Street crash in 1929. The bear market that ensued erased eighty nine percent of the DJIA.
