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


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | 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