What is a trend? Definition and example

A Trend is a general direction into which something is changing, developing, or veering toward. The term may also mean a fashion or craze, i.e., a fad. The verb ‘to trend’ means to develop or change in a general direction. In the world of social media, if something trends it is the topic of many posts.

In the world of business, a trend is a pattern of gradual change in a process, output, or condition. It is an average or general tendency. If I say: “There has been a trend towards shorter-term mortgages,” it means more people are now taking shorter-term mortgages. In other words, there has been a tendency towards shorter-term mortgages.

The Financial Times’ glossary of terms – ft.com/lexicon – has the following definition of the term:

“The general way in which a particular situation is changing or developing.”

Etymology of ‘trend’

Etymology is the study of the origin of words and how their meanings evolved.

The Online Etymology Dictionary says the verb ‘trend‘ emerged in the English language in the 1590s. At the time, it meant “to run or bend in a certain direction (of costs, rivers, etc.).”

It came from the Middle English word ‘Trenden,’ which meant “to revolve, turn, roll about.” ‘Trenden’ came from the Old English word ‘Trendan,’ which meant “roll, revolve, turn around.”

The Old English word came from the Middle Low German ‘Trint‘ and Middle Low German word ‘Trent,’ which meant “boundary, ring.” Connections outside Germanic are uncertain.

The noun appeared in 1777 and meant “the way something bends.” It was not until the 1950s that the word also meant “a prevailing new tendency in popular fashion or culture.”

Trend in financial markets
There are people who earn their living by analyzing trends and then deciding when and where to invest.

Market trends

A trend in financial markets is a perceived tendency to move in a specific direction over time. In other words, a perceived tendency to move in a particular direction.

We classify these trends as secondary for short time frames, primary for medium time frames, and secular for long time frames.

We can only confidently determine trends in hindsight. This is because, at any time, we do not know what future prices will be.

  • Bull market

A bull market or bullish trend is a market that has the tendency to move upward, i.e., prices are rising. If an investor feels bullish, he or she expects, for example, share prices to go up.

  • Bear market

A bear market or bearish trend is a market that has the tendency to move downward, i.e., prices are falling. If an investor feels bearish, he or she expects share prices to fall.

Market analysts spend considerable time creating models to predict these trends, which can significantly impact investment strategies and economic forecasts. These analytical models often incorporate complex algorithms that account for a multitude of variables, from geopolitical events to changes in consumer behavior, to enhance the accuracy of their predictions.

Trendy

A trendy person is somebody who is very up to date or fashionable. We can also use the term for styles or things. For example, a trendy hairstyle is a fashionable hairstyle. Trendy clothes are fashionable clothes.

Trend – vocabulary and concepts

There are dozens of compound words containing the word “trend,” such as “market trend.” Below, you can see seven such compound words, their meanings, and examples of how to use them in a sentence:

  • Trend Analysis

The practice of collecting information and attempting to spot a pattern.
Example: “The marketing team conducted a thorough trend analysis to determine the upcoming season’s consumer preferences.”

  • Trend Indicator

A quantitative measure that signals the direction of movement in an economy or a market.
Example: “The quarterly sales growth is a strong trend indicator for the company’s financial health.”

  • Industry Trend

Definition: The general direction of growth or change in a particular industry.
Example: “Keeping up with the latest industry trend is essential for businesses to stay competitive.”

  • Consumer Trend

The habits or behaviors currently prevalent among consumers, often influencing marketing and sales strategies.
Example: “Sustainability is a growing consumer trend that is shaping the way companies produce and market their products.”

  • Economic Trend

A pattern or change in the overall state of the economy.
Example: “Analysts are concerned about the new economic trend indicating a potential downturn.”

  • Technology Trend

The latest developments and advancements in technology.
Example: “Artificial intelligence is a technology trend that is revolutionizing multiple sectors, from healthcare to finance.”

  • Market Trend

The overall direction in which a financial market is moving.
Example: “Experienced investors know how to capitalize on a market trend to maximize their returns.”

Video – What is a Trend?

This educational video, from our sister channel on YouTube – Marketing Business Network, explains what the term ‘Trend’ means using simple and easy-to-understand language and examples.