Investor Glossary-deleveragingInvestor Glossary-deleveragingInvestor Glossary-deleveragingInvestor Glossary-deleveragingInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Deleveraging

The HTML to link to this page
 

Deleveraging is the unwinding of debt. Companies use leveraging (i.e. borrowing) to accelerate their growth or return, however, when a company is concerned about defaulting on its obligations or concerned about rampant losses, it can use deleveraging to lower its risk of default and mitigate its losses. By deleveraging its balance sheet, a company sells off debt to lower its overall risk profile. Deleveraging can have serious financial consequences when a company tries to unwind assets that are illiquid. In this case, deleveraging may mean selling assets at a relatively steep discount. As a result, deleveraging may lead to downward pressure on security and asset prices as more and more companies and/or individuals unwind their positions during the deleveraging process.



Rate this Deleveraging definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: diluted share, phantom income, labor relations, liquidity ratio, APR, per diem, ex-dividend date, ex-dividend, inflation, FICO score, option premium, average price per share, cancelled check, VIX, deferred revenue, covered put, class C shares, quality assurance, irrevocable trust, command economy, in escrow, wholly-owned subsidiary, retained earnings, debt service coverage, balance sheet, real GDP, required rate of return, 1031 exchange, minority interest, dividends payable, EBITDA, deferred tax, risk management, Key Rate Duration, 144a, annual return, implied volatility, limit order, LIBOR, 1035 exchange, margin rate, stock split, open position, 401a, reverse mortgage, current ratio, Zero Cost Collar, FTSE, stock market close


Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
Investor Glossary Index >>> # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
©2004-2014 Investor Glossary - All rights reserved - Terms of Use