Market Outlook · April 17, 2020

Anatomy of a Recovery: Digging Deeper into the Four Stages of a Bear Market

Brent Ciliano

CFA | SVP, Chief Investment Officer

1 Bear Market History: 27 Bear Markets since 1835 

A bear market event is commonly defined as a peak to trough drop in the market of 20% or greater, most often using the given benchmark’s price levels to identify these points.

2 What are the 4 stages of a Bear Market? 

The vast majority of the 27 bear markets post 1835, as well as a large number of market corrections (drawdowns, which are less than -20%) possess 4 stages.

3 2020 Bear Market: So what Stage are we on today and what’s next? 

In this cycle, the S&P 500’s maximum decline encompasses the period of February 19th through Monday March 23rd, falling -33.8%. The average decline for an Event Driven bear market is -29%.

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