Burst Basket

AAA

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.

RELATED TERMS
  1. Basket Option

    A type of financial derivative where the underlying asset is ...
  2. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  3. Portfolio

    A grouping of financial assets such as stocks, bonds and cash ...
  4. Diversification

    A risk management technique that mixes a wide variety of investments ...
  5. Sector

    1. An area of the economy in which businesses share the same ...
  6. Stock

    A type of security that signifies ownership in a corporation ...
Related Articles
  1. Diversification Beyond Stocks
    Investing Basics

    Diversification Beyond Stocks

  2. 5 Tips For Diversifying Your Portfolio
    Investing Basics

    5 Tips For Diversifying Your Portfolio

  3. 5 Things To Know About Asset Allocation
    Investing Basics

    5 Things To Know About Asset Allocation

  4. Introduction To Investment Diversification
    Investing Basics

    Introduction To Investment Diversification

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center