Animals in the World of Finance

If you take a look at a glossary of financial terms, you will notice something very peculiar. A lot of them have animal names. Sure, we are aware of bears and bulls, but what about black swans? White elephants? Ostriches? What do any of these animals have to do with the economy? And for that matter, what do they mean?

These animal terms are a common terminology that helps to define specific characteristics of trader types. Likewise, they describe certain investors and market scenarios. In this sense, their names are not completely outlandish as they do have a purpose in finance. There is a wide variety out there and in this article, we will be taking a look at some of them.


Bulls are investors who think the market, industry, or a specific security will eventually rise. Those who follow a bull’s beliefs often buy securities under the assumption that they can later sell them at a much higher price. These are optimistic investors who try to generate a profit from the stocks moving upward. Moreover, certain strategies accompany that theory. Bullish investors pinpoint securities with a better chance of value increase and send available funds towards those investments.

There are plenty of opportunities to become a bull investor regardless of how bearish an overall market or sector is. Bull investors seek out lucky chances in the down market, as well as attempt to capitalize if market conditions flip.

Some notable characteristics of the average bull market include:

  • A lengthy period of a boost in stock prices, often by 20% or more throughout at least two months.
  • A strong economy or one that is getting stronger.
  • High confidence and/or optimism from investors
  • An expectation that things will take a turn for the better during a prolonged period.


Bears are investors who subscribe to the belief that a particular security – or the broader market – is heading downward. On top of that, they may try to profit from a stock price decline. Bears don’t have a positive outlook when it comes to the overall state of a market or underlying economy. For example, imagine an investor acting bearish on the Standard & Poor’s (S&P) 500. In this particular case, the investor expects the prices to drop and they will try to profit from the broad market index’s downturn.

If bulls are optimists about market direction, bears are the complete opposite. Because they are pessimistic in that regard, they often use an array of techniques. Unlike traditional investing methods, these strategies allow them to profit from the market dropping and lose money when it surges. The most common technique of the bunch is ‘short selling’. This is a strategy that represents the opposite of the conventional buy-low-sell-high mindset of investing. Short-sellers tend to buy low and sell high, but reverse it and they sell first and buy later once. And they do this when – they hope, at least – the price drops.

Black Swans

Have you ever seen a black swan? Odds are you haven’t. This is because they are quite rare, and the same thing applies to the market events named after them. Black swans are unpredictable events that go beyond the normal expectations of a situation. Moreover, their consequences could potentially be very severe. Black swan events are defined by their remarkable rarity, extreme impact, and the insistence that they were evident in hindsight.

Black swan events have the capacity to cause catastrophic damage to an economy. What’s especially alarming is the fact that they are not easy to predict. As such, all we can do is prepare for them by building durable systems. However, relying solely on standard forecasting tools can frequently backfire. It can fail at predicting the events, as well as potentially increase vulnerability by propagating risk. On top of that, it can provide false security.

The best ways to describe black swans specifically as events are…

  1. …going beyond normal expectations that are incredibly rare. To the point where even the chances of it actually occurring is an enigma.
  2. …having a fatal impact whenever it takes place.
  3. …being able to be explained in hindsight as if it were foreseen.


A dove is an economic policy advisor who is responsible for promoting monetary policies. These are policies that normally consist of low interest rates. Doves often provide support for low-interest rates, as well as an expansionary monetary policy. This is mostly because they highly regard indicators, such as low unemployment, over maintaining low inflation. Economists calling for quantitative easing or implying that inflation has very few adverse effects are either doves or are acting “dovish.”

Doves think that the negative effects of low interest rates are – for the most part – inconsequential. With that said, if interest rates stay low for an indeterminate amount of time, inflation will experience a boost.


Hawks, also going by the formal monetary term “inflation hawks,” is a policymaker or advisor who focuses on the probable impact of interest rates. Specifically, as they connect to fiscal policy. Hawks are more willing to permit the rise of interest rates to make sure that inflation stays under control. In contrast to doves, hawks are those who support the belief that higher interest rates will inevitably curb inflation. Think of it this way: hawks prefer a resilient stance in an economic situation, whereas doves want to take an easier approach.


Ostriches are well-known for frequently sticking their heads in the sand and this is the best way to describe economic ostriches. These are investors who do this same action, so to speak, during bad markets. They do this in the hope that their portfolio will not receive any severe effects.

These investors often ignore bad news and expect it to go away eventually and not impact their investments too severely. Ostrich investors believe that not knowing how their portfolio is doing will help it survive and come out intact.

White Elephants

Much like black swans, white elephants are extremely rare to the point of being sacred. The term derives from Asia, mainly coming from white elephants belonging to Southeast Asian monarchs. These figures often resided in Burma, Laos, and Cambodia. It describes an asset whose cost of upkeep does not properly line up with its usefulness or value.

The roots of the white elephant icon go back to Thailand, formerly known as Siam. These elephants are very rare and during ancient times, many saw them as holy beings. Because of this, they were automatically given as gifts to the current monarch. There was a huge amount of affluence expected of someone owning these creatures of extremely high calibre.

As the story goes, the monarch would offer the white elephant as a gift of fortune. Whether that fortune leans more towards good or bad is often ambiguous. If he likes the recipient, then he would provide the gift of land along with the elephant. Doing this will help pay for the overall cost of the elephant. However, if he is not fond of you, then he will not include land. This in turn would promptly turn the gift into a money pit.


Unicorns might be mythical creatures found in fairy tales, but in the world of finance, they are very much real. Not literally, of course, but their association with rare appearances is applicable to business.

A unicorn is a privately held startup that has a $1 billion valuation or more. The term’s popularization was courtesy of venture capitalist, Aileen Lee. She is the founder of CowboyVC, a seed-stage venture capital fund that operates in Palo Alto, California.

The term is also a reference to a recruitment phenomenon that occurs within the sector of human resources (HR). Generally speaking, HR managers have high expectations when it comes to properly filling a position. This will inevitably lead to them looking for candidates who possess the right qualifications. To elaborate, they seek out those whose qualifications are much higher than what a specific job calls for.

What these managers are doing is, in essence, searching for a unicorn. Therefore, there is a notable disconnect. It lies between their ideal applicant and who they can employ from the group of people who are available.


There are plenty of other animal terms one can find in the world of economics. Rabbits, pigs, sheep, dogs, and many others are just as popular in the share market. However, the ones in this article give you a good idea of what you will find the next time you are browsing through a financial dictionary.