Showing posts from February 13, 2016

Saturday Finances—Stock Market Corrections

I'm no expert.  I'm just paying attention.

Stock Market Corrections

What's a stock market correction?
A correction is a decline in value or downward movement of a stock, bond, commodity or market index.  It occurs over a period of days, weeks or months from a 52-week high.
Pullback:  5% - 10% declineCorrection:  10% - 20% declineBears:  20% & over  Garden variety bear:  20% - 40%Mega-Meltdown bear:  40% & over

What's a stock market crash?
A crash is a 10% or more decline in value that occurs all in one day (Dow, S&P 500, NASDAQ).
Crashes are caused by panicked sellers in the wake of economic events, catastrophes, and crises.

Crash of 1929

A 4-day event during which shares fell in value by 25%
Thursday, October 24: 11% declineFriday, October 25:  Values rose; sales were triple the normal volume as buyers snapped up bargainsMonday, October 28:  13% declineTuesday, October 29:  11% decline
The Dow did not return to pre-crash levels until 25 years later on 23 November 195…