What Is Dead Cat Bounce?

What Is Dead Cat Bounce?

1 Answer

  1. According to Wikipedia, “ In finance, a dead cat bounce is a small, brief recovery in the price of a declining stock. Derived from the idea that “even a dead cat will bounce if it falls from a great height”; the phrase, which originated on Wall Street, is also popularly applied to any case where a subject experiences a brief resurgence during or following a severe decline.” Simply speaking it means that there’s a temporary rise in the prices of shares after a substantial fall which is generally caused by speculators as they are trying to cover their positions by buying.

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