Wall Of Worry

AAA

DEFINITION of 'Wall Of Worry'

The financial markets' periodic tendency to surmount a host of negative factors and keep ascending. Wall of worry is generally used in connection with the stock markets, referring to their resilience when running into a temporary stumbling block, rather than a permanent impediment to a market advance.

INVESTOPEDIA EXPLAINS 'Wall Of Worry'

While a "wall of worry" may sometimes consist of a single economic, political or geopolitical issue significant enough to affect consumer and investor sentiment, it more commonly comprises concerns on numerous fronts. The markets' ability to climb a wall of worry reflects investor confidence that these issues will be resolved at some point. However, market direction once the wall of worry has been surmounted is impossible to ascertain, and depends on the stage of the economic cycle at which it occurs.


For example, the markets' ability to climb the wall of worry is most clearly discernible at the end of major bear trends, which means that the markets may continue to advance once the wall has been surmounted. However, a continued advance is much less certain if the wall of worry forms near a major market peak, in which case a subsequent decline is more likely.

RELATED TERMS
  1. Systematic Risk

    The risk inherent to the entire market or entire market segment. ...
  2. Bull Market

    A financial market of a group of securities in which prices are ...
  3. Country Risk

    A collection of risks associated with investing in a foreign ...
  4. Political Risk

    The risk that an investment's returns could suffer as a result ...
  5. Market Value

    The price an asset would fetch in the marketplace. Market value ...
  6. Bulldog Market

    A nickname for the foreign bond market of the United Kingdom. ...
RELATED FAQS
  1. What is the difference between shares outstanding and floating stock?

    Shares outstanding and floating stock are different measures of the shares of a particular stock. Shares outstanding is the ... Read Full Answer >>
  2. What is the difference between market risk premium and equity risk premium?

    The only meaningful difference between market-risk premium and equity-risk premium is scope. Both terms refer to the same ... Read Full Answer >>
  3. What is the difference between the QQQ ETF and other indexes?

    QQQ, previously QQQQ, is unlike indexes because it is an exchange-traded fund (ETF) that tracks the Nasdaq 100 Index. The ... Read Full Answer >>
  4. What is the difference between an investment and a retail bank?

    The activities and types of clients for an investment bank versus those for a retail bank highlight the primary difference ... Read Full Answer >>
  5. Will technology ever disrupt the role of the custodian bank?

    Custodian banks, along with other financial institutions that hold custodian accounts, are likely to be disrupted but not ... Read Full Answer >>
  6. What is the average range for the price-to-earnings ratio in the electronics sector?

    Investors purchase shares of company stock and other traded securities through capital markets in either primary or secondary ... Read Full Answer >>
Related Articles
  1. Investing Basics

    Adapt To A Bear Market

    Learn how your portfolio should evolve to suit bear market conditions.
  2. Fundamental Analysis

    Financial Markets: Random, Cyclical Or Both?

    Are the markets random or cyclical? It depends on who you ask. Here, we go over both sides of the argument.
  3. Active Trading Fundamentals

    Forces That Move Stock Prices

    You can't predict exactly how stocks will behave, but knowing what affects prices will put you ahead of the pack.
  4. Economics

    Riding The Bear Into A Bull Market

    How can you get back into the market to avoid missing market recovery gains? Find out here.
  5. Active Trading Fundamentals

    Surviving Bear Country

    Stay calm, play dead and keep your eyes open for attractive valuations.
  6. Economics

    When Stock Prices Drop, Where's The Money?

    Market perception can create money - and make it disappear into thin air.
  7. Investing Basics

    Understanding NASDAQ

    NASDAQ is an acronym that stands for the National Association of Securities Dealers Automated Quotation system.
  8. Investing Basics

    Explaining the Equity Market

    Equity market is a general term referring to a place were corporate stocks are sold.
  9. Economics

    Is The Yuan The New Greenback?

    China is increasingly top of mind for investors. While bulls see an opportunity in a massive equity rally, bears are focused on a slowing economy.
  10. Economics

    Why To Pay Attention To Today’s Buyback Boom

    There has been a lot of debate recently about whether today’s buyback boom, $133 billion for S&P companies, is good or bad for the economy and for markets.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!