Dead Cat Bounce

In investing, a “dead cat bounce” is a brief spike in market rates following a major decline. The bounce is normally caused by investors who rush to purchase securities when they believe rates are as low as they will get in hopes of profiting off the subsequent rebound. The rise in rates caused by the dead cat bounce effect is typically very small compared to the rate decline that led up to it.

The term is derived from a somewhat morbid market theory which states that even a dead cat will bounce if dropped from high enough.

More on this topic:
Swiss online broker comparison
How to buy stocks: best trading tips
Stock trading: common pitfalls

About moneyland.ch

moneyland.ch is Switzerland’s independent online comparison service covering banking, insurance and telecom. More than 70 unbiased comparison tools and calculators are available on moneyland.ch, along with useful financial guides and timely news. The comprehensive comparison tools help you to find the right insurance policies, bank accounts, credit and prepaid cards, loans, mortgages, trading accounts and telecom products for your needs.