Depressed

AAA

DEFINITION of 'Depressed'

A state or condition of a market, product or security characterized by slumping prices, low volumes, and lack of buyers. "Depressed" usually refers to a prolonged period of low prices and activity. The term may also be used in the context of the broad economy, in which case it generally refers to recessionary conditions.

INVESTOPEDIA EXPLAINS 'Depressed'

A period of depressed prices for a market or security usually occurs after prices have run up, peaked and subsequently declined for a prolonged period. Prices may remain in a depressed state for months, if not years, depending on the extent to which they had rallied beforehand and the amount of over-capacity or excess supply.

As an example, the U.S. housing market was in a depressed state for a number of years from 2008 onwards, as excessive real estate speculation led to a housing bubble in the preceding years. When the bubble burst, millions of homeowners were forced into foreclosure, creating an excess supply of homes that lasted for years.

RELATED TERMS
  1. Business Cycle

    The fluctuations in economic activity that an economy experiences ...
  2. Indicator

    Statistics used to measure current conditions as well as to forecast ...
  3. Market Sentiment

    The overall attitude of investors toward a particular security ...
  4. Depression

    A severe and prolonged downturn in economic activity. In economics, ...
  5. Economic Cycle

    The natural fluctuation of the economy between periods of expansion ...
  6. Bear Fund

    A mutual fund designed to provide higher returns when the market ...
Related Articles
  1. How Influential Economists Changed Our ...
    Fundamental Analysis

    How Influential Economists Changed Our ...

  2. Where's The Market Headed Now?
    Fundamental Analysis

    Where's The Market Headed Now?

  3. The Lost Depression
    Credit & Loans

    The Lost Depression

  4. Recession: What Does It Mean To Investors?
    Active Trading Fundamentals

    Recession: What Does It Mean To Investors?

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center