Skip to main content

Why are Bull and Bear symbols of the stock market?

For those who don't spend a lot of time on Wall Street, bulls and bears refer to opposite trends in the stock market. According to Investor Words, a bull market is "a prolonged period in which investment prices rise faster than their historical average." Conversely, a bear market means "a prolonged period in which investment prices fall, accompanied by widespread pessimism." So, bulls good, bears bad...

No one's quite sure how the two animals came to symbolize the market, but there are a few theories floating around. According to Motley Fool, a bear market earned its name because bears tend to swat at things with their paws in a downward motion (as in "the market's going down"). A bull market, on the other hand, got its name because bulls swing their horns upward when they strike (as in "the market's going up").

Another theory proposes that the animals' personalities are behind the symbolism. Bears move with caution, while bulls are bold and like to charge ahead. So a "bearish" investor thinks the market will go down, while a "bullish" investor thinks it's headed up.

Certainly no one can argue that both animals are intimidating and best avoided. Maybe they're meant to serve as a warning to investors: Unless you know what you're doing, you could be headed for pain. [Via]