##  [# Correction Definition](/sections/correction-definition) 

 

# Correction Definition

 

 

Learn the definition of correction and other ETF terminology from the etf.com glossary.



 

 

 

 

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[By ETF Glossary](/authors/etf-glossary)

 Jan 08, 2024

 Edited by: ETF.com Staff

 

 

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## Learn more about Corrections

In ETFs, a correction denotes a substantial short-term decline in the market, typically exceeding 10% from its recent peak. Corrections are natural phases within market cycles, often triggered by various factors, including economic indicators or geopolitical events. ETFs tracking broad market indices experience value fluctuations during corrections as underlying securities adjust to shifting market sentiment. Investors recognize corrections as potential buying opportunities, leveraging the inherent diversification in ETFs to navigate market volatility. Understanding corrections is integral to devising a well-informed investment strategy and capitalizing on market conditions for long-term portfolio growth.

### Related Terms

[Diversification](/etf-education-center/etf-glossary/diversification), [Exchange-Traded Fund (ETF)](/etf-education-center/etf-glossary/exchange-traded-fund-etf)

 
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 [ ETF Glossary ](/authors/etf-glossary) 

 

 

  ETF Glossary is etf.com’s collection of key terms and definitions related to exchange-traded funds. ETFs are investment funds that are traded on stock…   [View Bio](/authors/etf-glossary)

 



 

 


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