What Is a Bear Fund? A bear fund is a mutual fund that investors use to provide higher returns amid market downturns. Bear funds can be actively managed or designed to follow an index. In the example of an index bear fund, the fund tracks the inverse of the index. Bear funds tend to be
What Is a Bear Hug? In business, a bear hug is an offer to buy a publicly listed company at a significant premium to the market price of its shares, designed to appeal to the target company’s shareholders. It’s an acquisition strategy used to pressure a reluctant company board to accept the bid or risk
What is a Bearish Engulfing Pattern? A bearish engulfing pattern is a technical chart pattern that signals lower prices to come. The pattern consists of an up (white or green) candlestick followed by a large down (black or red) candlestick that eclipses or “engulfs” the smaller up candle. The pattern can be important because it shows sellers
Investopedia / Daniel Fishel What Is a Bear Market? A bear market is when a market experiences prolonged price declines. It typically describes a condition in which securities prices fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment. Bear markets are often associated with declines in an overall market or
What Is a Bear Market Rally? Bear market rally refers to a sharp, short-term rebound in share prices amid a longer-term bear market decline. Bear market rallies are treacherous for investors who mistakenly come to believe they mark the end of an extended downturn. As the primary bearish trend reasserts itself, the disappointment of those who
What Is a Bear Put Spread? A bear put spread is a type of options strategy where an investor or trader expects a moderate-to-large decline in the price of a security or asset and wants to reduce the cost of holding the option trade. A bear put spread is achieved by purchasing put options while
What Is a Bear Steepener? A bear steepener is the widening of the yield curve caused by long-term interest rates increasing at a faster rate than short-term rates. A bear steepener is usually suggestive of rising inflationary expectations–or a widespread rise in prices throughout the economy. The rise in inflation can lead to the Federal
What Is a Bear Straddle? A bear straddle is an options strategy that involves buying (or selling) both a put and a call on the same underlying security with an identical expiration date and strike price, but where the strike price is above the security’s current market price. This is a type of “crooked” or
What Is a Bear Tack? Bear tack is a slang term used by stock investors and analysts to describe a negative movement in a stock, sector, or market that may foretell the beginning of a downward trend. Tacking is a term borrowed from sailing that refers to a maneuver in which a sailboat caught in
What Is a Bear Trap? A bear trap is a technical pattern that occurs when the price action of a stock, index or another financial instrument incorrectly signals a reversal from an uptrend to a downtrend. In other words, prices may move higher in a broad-based incline, only to encounter significant fundamental resistance or change.
