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Where do the stock market terms Bull and Bear come from?

Arturo Di Modica's famous
Arturo Di Modica's famous "Charging Bull" statue near Wall Street in New York.
Arturo Di Modica’s famous “Charging Bull” statue near Wall Street in New York.

The terms “Bull and Bear” when describing market conditions. Where do they come from? We hear the terms most every day. If the market is going up, the bulls are running. If it’s going down, people are feeling “bearish”.

Many of us with a connection to the world of finance have had our picture taken with Arturo Di Modica’s famous “Charging Bull” statue near Wall Street in New York, but when pressed, few could actually name the origins of the terms “bull” and “bear” as they apply to the markets.

First of all, a couple explanations of the origins of the usage that probably aren’t true.

The terms “bear” and “bull” likely do not derive from the way in which each animal attacks its opponents, the bull with an upward motion of its horns, the bear by “pulling down” its victim.

Nor is it likely that they derive from the practices of middlemen in the bearskin trade.

Another theory is that the terms derive from two prominent families; the Bulteels and the Barings. But the banks that bore their names were both founded after the terms had been in popular use for some time.

And it may be getting warmer, but it probably doesn’t refer to the this rhyme from Alexander Pope, which was written in 1720.

Come fill the South Sea goblet full; The gods shall of our stock take care: Europa pleased accepts the bull, And Jove with joy puts off the bear.


This is the most plausible explanation of the terms Bull and Bear

The most plausible explanation is that the terms bull and bear actually date back to the London Stock Exchange of the 1600’s. The primitive version of the modern data centres consisted of a bulletin board on which traders could post offers to buy stock. When offers were abundant, the board was full of bulletins, or “bulls”. When offers were scarce, the exchange was “bare” of offers. The terms evolved into Bull, for bulletin, and Bear, for bare, or devoid of buy orders.

Bull and bear? Who wins more often?

So which is more common? Easy. Anyone observing the overall trend of the market in any kind of long form chart will see that the bulls are out and running more than the bears. One analysis by Morningstar examined stock market data from the period of 1926 to 2014. They found that a typical bull market lasted 8.5 years with an average cumulative total return of 458%.

What about the bears? Well, from 1926 to 2014, the average bear market lasted just 13 months with an average cumulative loss of 30%.

And what about the pigs? Pigs, you say? Yes pigs. After all, bulls can make money going long. Bears can make money going short. But pigs, according to one of the most common insider terms on the street, never win. If you are in the industry you are bound to hear it at least once a year: “Bulls Win, Bears Win and Pigs Get Slaughtered.

The meaning? It’s a cautionary phrase meant to warn against greed. Because on Wall Street, after all, Greed is Not Good.


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About The Author /

Cantech Letter founder and editor Nick Waddell has lived in five Canadian provinces and is proud of his country's often overlooked contributions to the world of science and technology. Waddell takes a regular shift on the Canadian media circuit, making appearances on CTV, CBC and BNN, and contributing to publications such as Canadian Business and Business Insider.
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