Difference between revisions of "Liquidate"

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'''Liquidate''' means to sell all of a company's [[asset]]s, pay its outstanding debts, and distribute the remainder to shareholders, and then go out of business.
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To liquidate means to [[sell]] all of a company's [[asset]]s, pay its outstanding [[debt]]s, and distribute the remainder to [[shareholder]]s, and then go out of business.
  
In the financial markets, to liquidate refers to a broker selling his or her customer's securities after the customer has failed to meet a [[margin call]].  
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In the financial markets, to liquidate refers to a [[broker]] selling his or her customer's [[securities]] after the customer has failed to meet a [[margin call]].  
  
It can also mean to convert assets into cash.<ref>{{cite web|url=http://www.merriam-webster.com/dictionary/liquidate|name=liquidate|org=Merriam-Webster|date=October 14, 2008}}</ref>
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It can also mean to convert assets into [[cash]].<ref>{{cite web|url=http://www.merriam-webster.com/dictionary/liquidate|name=liquidate|org=Merriam-Webster|date=October 14, 2008}}</ref>
  
In futures trading, when a trader exits or offsets a long position, they are liquidating a long position. Similarly, when a trader exits a short position, they are covering shorts, though this is also considered liquidation.<ref>{{cite web|url=http://www.futuresknowledge.com/Resources/glossary.asp|name=Glossary of Terms|org=Futures Knowledge.com|date=December 20, 2008}}</ref>    When an entire account's positions are to be offset, the positions are said to be liquidated.  
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In [[futures]] [[trading]], when a trader [[exit]]s or [[offset]]s a [[long]] [[position]], they are liquidating a long position. Similarly, when a trader exits a short position, they are covering shorts, though this is also considered liquidation.<ref>{{cite web|url=http://www.futuresknowledge.com/Resources/glossary.asp|name=Glossary of Terms|org=Futures Knowledge.com|date=December 20, 2008}}</ref>    When an entire account's positions are to be offset, the positions are said to be liquidated.  
  
 
== Liquidation Value ==
 
== Liquidation Value ==
 
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In a futures account, the [[bottom line]] value of all cash, [[open]] futures positions and long and short [[options]] positions, marked to the market, is referred to as the liquidation value of the account.<ref>{{cite web|url=http://www.interactivebrokers.com/php/webhelp/dvp/ibexAcct.htm|name=Account Information|org=Interactive Brokers|date=December 20, 2008}}</ref>
In a futures account, the bottom line value of all cash, open futures positions and long and short options positions, marked to the market, is referred to as the liquidation value of the account.<ref>{{cite web|url=http://www.interactivebrokers.com/php/webhelp/dvp/ibexAcct.htm|name=Account Information|org=Interactive Brokers|date=December 20, 2008}},/ref>
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ALSO SEE: [[Bankruptcy]]
 
ALSO SEE: [[Bankruptcy]]
 
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== References ==
 
== References ==
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[[Category:Market Terms]]
 
[[Category:Market Terms]]
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[[Category:Definitions]]

Latest revision as of 03:17, 28 July 2016

To liquidate means to sell all of a company's assets, pay its outstanding debts, and distribute the remainder to shareholders, and then go out of business.

In the financial markets, to liquidate refers to a broker selling his or her customer's securities after the customer has failed to meet a margin call.

It can also mean to convert assets into cash.[1]

In futures trading, when a trader exits or offsets a long position, they are liquidating a long position. Similarly, when a trader exits a short position, they are covering shorts, though this is also considered liquidation.[2] When an entire account's positions are to be offset, the positions are said to be liquidated.

Liquidation Value

In a futures account, the bottom line value of all cash, open futures positions and long and short options positions, marked to the market, is referred to as the liquidation value of the account.[3]

ALSO SEE: Bankruptcy

References

  1. liquidate. Merriam-Webster.
  2. Glossary of Terms. Futures Knowledge.com.
  3. Account Information. Interactive Brokers.