A bear market refers to a period in financial markets when the prices of securities fall by 20% or more from recent highs. This decline typically occurs over a sustained period, often accompanied by widespread pessimism and negative investor sentiment. Bear markets can affect various asset classes, including stocks, bonds, and commodities. During a bear market, investors may become more cautious, leading to reduced buying activity. Economic factors such as rising interest rates, inflation, or geopolitical tensions can contribute to the onset of a bear market. Understanding this concept is crucial for investors to navigate market fluctuations effectively.