What is a bearish stock perspective?

Investors can be bearish about the entire stock market, a sector, or individual stocks. A bearish stock perspective involves abelief that a stock or market will struggle and may see price declines. In a bear market, many investors may choose to sit out of the market while others look for opportunities to profit on declining stock prices.

What is a bearish market?

The term “bearish market” refers to an investor viewpoint that the particular stock security, commodity, asset, currency, or the entire market will go down in value. The fall in stock prices is 20% or more. It is a pessimistic approach —investors speculate about a negative movement in stock prices and take a short position to benefit from it.

Are investors 'bearish' or 'bullish'?

Although some investors can be "bearish," the majority of investors are typically "bullish." The stock market, as a whole, has tended to post positive returns over long time horizons. A bear market can be more dangerous to invest in, as many equities lose value and prices become volatile.

What does it mean if a trader is bearish on stocks?

To say a trader is "bearish on stocks" means they believe the price of stocks will decline in value. A person may hold bearish beliefs about a specific company or about a broad range of assets. A trader with bearish beliefs may choose to act on them or not. If the trader does act, they may sell shares they currently own, or they may go short.