The Dow Jones Industrial Average has fallen into what investors call a bear market. If you’re just tuning in or watching your retirement savings shrink, here’s what you need to know about the grizzly decline.
What is a bear market?
Stocks enter a bear market when widely followed indexes such as the Dow or S&P 500 sink 20% from their high points. There is nothing official about the determination. The designation is a shorthand way for Wall Street to mark when markets have taken a tumble. It also gives investors a moment to reflect on how the current action in markets compares to previous downdrafts.