n NISM Certifications
XV NISM Series XV
Medium

Which of the following is a characteristic of a bear market?

Practice question from NISM XV Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Prices are rising steadily

  2. B

    Investor confidence is high

  3. Prices are falling and pessimism prevails

    Correct answer

  4. D

    Trading volumes are negligible

Why this is the answer

A bear market is characterized by falling stock prices, negative investor sentiment, and pessimism about future economic prospects. Rising prices and high confidence are features of a bull market. Trading volumes may vary but are not defining of a bear market.

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