Dead Cat Bounce

Posted in Finance, Accounting and Economics Terms, Total Reads: 1126

Definition: Dead Cat Bounce

When a deep fall in the price of a particular stock is followed by a small rise in its price, this phenomenon is termed as dead cat bounce.

Practically, the phrase means to say that even when a dead cat falls from a great height, its body bounces a little again in the upward direction. This word emerged from the Wall Street when the price of a stock falls to a great extent in the bear market but rises for a short time in the form of ripples though the rise is only temporary.

This generally causes a combination of rise and fall simultaneously in the form of short ripples though the fall is bound to continue after the short period.

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