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Investing & the Stock Market vocabulary · Market News & Sentiment

Correction

Meaning in investing & the stock market, with examples

/kəˈrekʃn/nounCommon term

In investing & the stock market, correction means: A fall in prices of usually at least 10 percent from a recent high, seen as a pause or adjustment after a strong rise rather than the start of a long decline.

In Turkish: düzeltme, geri çekilme

How it is used

News reports say a market entered correction territory or that a stock is in a correction. Analysts may describe a fall as 'a healthy correction'. If the fall reaches 20 percent, it is usually called a bear market instead.

Example sentences

  1. After a 40 percent rise this year, a correction was not surprising.

  2. The technology index is now in correction territory, down 11 percent from its peak.

Common collocations

  • market correction
  • healthy correction
  • correction territory
  • sharp correction
  • bear marketA long period in which prices in a market fall and investors are generally pessimistic. It is often defined as a fall of 20 percent or more from a recent high.
  • sell-offA sudden period in which many investors sell at the same time, causing prices of a stock, sector or whole market to fall quickly.
  • profit-takingSelling investments after their price has risen in order to turn paper gains into real cash, which can cause a short fall in prices.
  • all-time highThe highest price or level that a stock, index or other asset has ever reached since trading in it began.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Market News & Sentiment

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This page explains English vocabulary for learners. It is not financial advice.