Encyclopedia of Investment Terminology

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Black Monday 1987

Black Monday is a commonly used reference in investments that relates to the stock market crash on October 19, 1987. The Dow Jones Industrial Average lost twenty-two percent of its value on this day. Although there were no significant events that took place that could have caused this, many factors can be seen. Program trading, which involves computers making quick stock transactions according to price changes, is considered by many to be a factor. General investor panic is attributed as a cause as well. This helped to cause trading curbs, which are events where a stock market stops for a period of time due to a massive decline, to be created for many markets.

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