Investor Glossary-distressed securityInvestor Glossary-distressed securityInvestor Glossary-distressed securityInvestor Glossary-distressed securityInsightful 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

Distressed Security

The HTML to link to this page
 

A distressed security is a security belonging to a company that is under financial distress, such as bankruptcy, restructuring, liquidation, etc. in order to be able to pay debts (avoid insolvency). One strategy for dealing with a distressed security is to purchase the distressed security at a discount price and hold onto it until it has appreciated again in value. This investment strategy is considered risky because there is a chance that the company of the distressed security will not recover at all. Still, the potential profit from a distressed security makes it appealing to more aggressive investors. These profits may result from the market's lack of understanding of the true value of the distressed security. A distressed security may also be known as a distressed asset.



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


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Investor Glossary | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use