Market decline refers to a period where the overall value of financial markets, particularly the stock market, decreases significantly. This often signals an...
Market declines can be triggered by various factors, including economic recessions, geopolitical events, rising interest rates, inflation fears, company earnings disappointments, and shifts in investor sentiment.
The duration of market declines varies significantly. Minor corrections might last weeks to months, while more severe bear markets can persist for several months to over a year.
A market correction is generally defined as a decline of 10-20% from a recent peak. A bear market is a more severe and prolonged decline, typically characterized by a drop of 20% or more.
Investors can prepare by diversifying portfolios, maintaining a long-term perspective, avoiding panic selling, and ensuring adequate emergency funds. Consulting a financial advisor is also recommended.