Username: Andrew Rating: Asked to: Dara Madee Date Created: 25 Oct 2018 |
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Category | 28 |
Tag | Financial |
Question | What is a 'Correction'? |
Hello Andrew, A correction is a movement, almost always temporary and happening in reverse, that accounts for at least a 10 percent adjustment to fix the overvaluation of a stock, bond, commodity or index. A correction can usually be predicted during an analysis, and by comparing one market index to a similar market index. Using this method, an analyst may discover that an underperforming index will be followed closely by a similar index that is also underperforming. A steady trend of these similarly slowing indexes may be a sign that a market correction is coming. |
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