Burst Basket

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DEFINITION of 'Burst Basket'

A burst basket refers to a particular type of stock transaction that involves the sale or purchase of a "basket of stocks". A basket is basically an entire portfolio of stocks (five to 50 stocks) from different sectors that are purchased in the aggregate by an equity specialist.

INVESTOPEDIA EXPLAINS'Burst Basket'

This term is usually used in reference to a burst basket execution used in trading programs. The floor specialists would trade the component stocks in order to buy or sell the specific basket of stocks.

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