Market basics
What is Market correction?
Also called: Correction
Hinglish mein padhein: Market correction kya hota hai?
A correction is a fall of about 10% to 20% from a recent high — sharper than a normal dip but smaller than a bear market.
Corrections are common and healthy in long bull markets because they cool excess optimism.
Investors who planned their asset allocation in advance find it easier to stay calm during corrections.
Related terms
- Bull marketA bull market is a long period of rising prices and optimism, often defined as a rise of 20% or more from a recent low.
- Bear marketA bear market is a sustained fall in prices, commonly defined as a decline of 20% or more from a recent peak.
- VolatilityVolatility measures how much and how quickly a price moves. Higher volatility means bigger swings in both directions.