What is a bull market and a bear market?
A bull market is a longer period in which the stock market rises and the mood is optimistic. A bear market is the opposite: the market has fallen at least 20% from its latest peak, and the mood is pessimistic. The names come from how the animals attack — the bull thrusts upward, the bear swipes downward. A fall of 10–20% is called a correction, not a bear market.
The bull thrusts upward, the bear swipes downward. A bear market is a fall of 20% or more.
How long they last
Historically, bull markets have lasted much longer than bear markets. In the US a typical bull market has lasted several years and returned over 100%; a typical bear market has lasted around a year and cost 30–35%. That is why the person who simply stays put has historically done best: the bear is unpleasant, but the bull has had the last word every time so far. There is no guarantee that continues — but it is the pattern.
A worked example — why 20% down needs 25% up
Your portfolio is 100,000. A bear market takes 20%: you have 80,000. To get back to 100,000, the 80,000 must rise 25% — not 20%. If the market falls 50%, it must rise 100% to get back. That is the maths behind why big falls take a long time to recover.
What to do in a bear market
The honest answer: usually nothing. If you sell after a 20% fall, you have made the loss real and now have to pick the right moment to buy back — which almost never works. Most experienced investors use bear markets to continue their regular saving, because stocks are cheaper. That requires a time horizon longer than the bear.
The typical beginner's mistake
Selling everything in the middle of a bear market to "wait until it is calm again". By the time it is calm, prices have already risen. The best single days on the stock market almost always fall in the worst periods — and if you miss them, you miss a large part of the return.
How you see it in Kiggo
Kiggo's heat map shows the mood of the market at a glance: mostly red or mostly green. Kiggo's medium- and long-term rings look at the trend over months and years, not the day's mood. Kiggo does not say "sell" in a bear market or "buy" in a bull market — it explains what the numbers show and leaves the decision to you.
Related terms
Frequently asked questions
When is it officially a bear market?
When a broad index has fallen 20% or more from its latest peak. No authority declares it — it is a rule of thumb everyone uses.
What is a correction?
A fall of 10–20% from the top. Corrections happen almost every year and are normal. Bear markets are rarer — typically every 5–7 years.
Can you make money in a bear market?
Yes, by buying cheaply for later, or by short selling — but the latter is risky and not for beginners. For most people the gain in a bear market is that their regular saving buys more shares for the same money.
Kiggo explains — Kiggo does not advise. We never tell you what to buy or sell, and key figures can only be compared between companies in the same industry. The decision is yours. Last updated 2026-09-23.
Written by Claus Frisch, founder of Kiggo. Not an adviser, not a bank — Kiggo explains, you decide.
