A correction is a reverse movement, usually negative, of at least 10 percent in a stock, bond, commodity or index to adjust for an overvaluation.
 | | Correction | | A correction is generally defined as a ten percent or greater decline in the price of a security from its most recent peak. Corrections can occur in individual stocks, indexes, commodities, currencies or any asset that is traded on an exchange. An asset, index, or market may fall into a correction either briefly or for sustained periods of time, including days, weeks, months, or even longer. | | Breaking it Down: | | Corrections can sometimes be projected using market analysis, and by comparing... | | Read More » | | Sell-Off | | A sell-off is rapid selling of securities, such as stocks, bonds and commodities which leads to a decline in the value of the security. | | Read More » | | | Buy a Bounce | | Buy a bounce is a strategy that focuses on buying a given security once the price of the asset falls toward an important level of support. | | Read More » | | | Hedge | | A hedge is an investment to reduce the risk of adverse price movements in an asset. | | Read More » | | | Bear Market | | A bear market is a market in which securities prices fall and widespread pessimism causes the negative sentiment to be self-sustaining. | | Read More » | | |  | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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