liquidate a position


Also found in: Dictionary, Thesaurus, Legal, Encyclopedia.

Liquidation

The conversion to cash. Liquidating a position may simply mean selling stock or bonds; the seller in this case receives the cash. Liquidation also refers to a situation in which a company ceases operations and sells as many assets as it can; the company uses the cash to repay debt and, if possible, shareholders. Liquidation often has a negative connotation for this reason. See also: Panic selling.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

liquidate a position

To sell all the stock or debt securities of a particular type. For example, a portfolio manager might decide to liquidate a position in a stock by selling all the shares of that stock held in the portfolio. A variety of reasons may induce the investor to do this, but the most common one is simply a belief that the security price will fall.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.