Blockage Discount

Dictionary Says

Definition of 'Blockage Discount'

The difference between the market value of a security and its sale price when transacted under a block trade. Each blockage discount is negotiated by the involved institutional investors, which incorporates such factors as market liquidity and the size of the trade.
Investopedia Says

Investopedia explains 'Blockage Discount'

A block of securities will typically consist of 10,000 shares or debt securities valued over $200,000. Traders want to unload all of the securities quickly, but are often limited by market volume. To facilitate a fast exchange, a trader will sell the assets at a discount to another institutional investor.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Block

    A large amount ...
  2. Block Trade

    An order or ...
  3. Institutional Investor

    A non-bank ...
  4. Iceberg Order

    A large single ...
  5. Discount

    The condition of ...
  6. Block Order

    A signficant ...
  7. Agency Bond

    A bond issued by ...
  8. Convertible Arbitrage

    An investing ...
  9. Liquidation

    1. When a ...
  10. Canada Savings Bond - CSB

    A financial ...

Articles Of Interest

  1. Keeping An Eye On The Activities Of Insiders And Institutions

    These transactions reveal much about a stock. We go over what to consider and where to find it.
  2. Institutional Investors And Fundamentals: What's The Link?

    Big-money sponsorship might make a company look good, but it's not always a reliable gauge of stock quality.
  3. Stock Basics Tutorial

    If you're new to the stock market and want the basics, this is the tutorial for you!
  4. Bond Basics Tutorial

    Investing in bonds - What are they, and do they belong in your portfolio?
  5. This Is Your Brain On Stocks

    Find out how the human mind can hurt investors' portfolios.
  6. Should You Invest Your Entire Portfolio In Stocks?

    It is true that stocks outperform bonds and cash in the long run, but that statistic doesn't tell the whole story.
  7. 5 Tips For Diversifying Your Portfolio

    A diversified portfolio will protect you in a tough market. Get some solid tips here!
  8. 5 Popular Portfolio Types

    Learning how to build these portfolios will increase your investing confidence and give you financial control.
  9. How To Invest When You're Deep In Debt

    Debt is one of the biggest obstacles that prevents people from investing - but it shouldn't be.
  10. Finding Your Investing Comfort Zone

    Choosing the right investments for you is the best way to feel comfortable with your portfolio.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center