---
title: Bear and bull markets, explained
description: Bulls are good, bears are bad — but why do we use those animals to refer to markets?
---

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# [Bear and bull markets, explained](https://hs-sbup.thehustle.co/news/06152022-bear-and-bull-markets)

 Written by [Juliet Bennett Rylah](https://hs-sbup.thehustle.co/news/author/juliet-bennett-rylah) | Jun 15, 2022 6:57:50 AM

You’ve probably heard the term “bear market” a lot lately — but what does it mean?

How does it differ from a bull market?

And why are we involving animals in all this?

#### **Definitions, first**

- Bear market: Prices are dropping.
- Bull market: Prices are rising.

How much? Usually, an increase or decrease of 20% or more from a recent high or low. So, right now, we’re in a bear market because the S&P 500 index closed at 3,749.91, down ~22% from its previous high of 4,818.62 in January, [per](https://www.cnbc.com/2022/06/14/what-experts-say-to-do-during-a-bear-market.html#:~:text=Put%20simply%2C%20bear%20market%20is,its%20previous%20high%20being%204%2C818.62.) *CNBC*.

While these terms are commonly used to refer to markets — the S&P 500, Nasdaq, and the Dow Jones Industrial Average — they can [also refer](https://www.businessinsider.com/personal-finance/what-is-a-bull-market) to individual stocks or other assets.

#### **Why the animals?**

There are multiple theories for the terms’ origins. One is that it’s how they kill: bulls gore enemies by thrusting upward with their horns, while bears swipe down with their claws.

But a popular [theory](http://www.todayifoundout.com/index.php/2013/04/origin-of-the-stock-market-terms-bull-and-bear/) dates back to a proverb about not selling a bear’s skin before you’ve caught the bear.

In the 18th century, when someone sold something they didn’t yet own, hoping they could buy it later at a lower price, people would say they were a “bearskin jobber” who’d “sold the bearskin.”

- That term was further popularized after the [South Sea Bubble](https://www.historic-uk.com/HistoryUK/HistoryofEngland/South-Sea-Bubble/), a financial crash in 1720 involving the South Sea Company, a trading company that turned out to be pretty worthless despite its once-soaring stocks.

And if that’s where the “bear” came from, another theory is that “bull” came about because people used to — ugh — make bulls and bears fight one another for entertainment.

[View full post](https://hs-sbup.thehustle.co/news/06152022-bear-and-bull-markets)

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