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Stock Market Crash

By Kimberly Amadeo, About.com

Wall Street Trader

(Credit: Spencer Platt/Getty Images)

Definition: Stock market crash is whenever the stock market, usually the Dow Jones Industrial Average, loses several hundred points in one day. The worst crash was “Black Thursday” which kicked off the Great Depression. On October 24, 1929, 12.9 million shares of stock were sold in one day, triple the normal amount. Share prices fell 15 - 20%, causing a stock market crash.

A stock market decline is more gradual, although crashes can occur in a decline and can even cause a more prolonged decline. A stock market decline that lasts for years is known as a bear market. A bear market is often accompanied by a recession.

Common Misspellings: stock mraket crash, stock markret crash
Examples:
Even the most sophisticated investor finds it difficult to recognize a stock market crash until it is too late!

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