A Stock market crash is defined as sudden steep decline in stocks prices on the stock market. While there are no particular set of rules for what defines a crash, it is generally said to occur when the percentage of loss is steep with double digits over a period of a week. They are normally caused by a combination of panic and economic factors. It may follow after a long term of positive expectations and continued price increases in stocks, or if too much borrowed money placed in the markets is not repaid. When investors feel concern or fear of a possible loss because of these conditions, it may trigger panic with mass selling of stocks.
This mass hysteria and negative sentiment on the stock market fuels a craze of selling which keeps on driving stock prices down, thus causing the stock index to suffer. Bear markets are a period where declining stock prices occur over a period of time, sometimes months or years. However, a stock market crash is often sudden and dramatic occurring over several days. Over the decades, there have been a number of crashes that have taken place, some being more severe than others.