Champagne Stock

DEFINITION of 'Champagne Stock'

A slang term used to describe a stock that has appreciated dramatically. A champagne stock is one that has made shareholders a great deal of money. Although champagne stocks can come from any industry and sector, bubble stocks have made and lost shareholders quite a bit of money before those bubbles burst.

BREAKING DOWN 'Champagne Stock'

A champagne stock is typically one that has at least doubled or tripled in value in a relatively short period, creating a huge profit for the company's shareholders. The term is used because individuals who hold such stocks will often order an expensive bottle of champagne to celebrate their good fortune.

RELATED TERMS
  1. Bubble Company

    A company whose valuation greatly exceeds that suggested by its ...
  2. Echo Bubble

    A post-bubble rally that becomes another, smaller bubble. The ...
  3. Bubble

    1. An economic cycle characterized by rapid expansion followed ...
  4. Speculative Bubble

    A spike in asset values within a particular industry, commodity, ...
  5. Shareholders' Agreement

    An arrangement among a company's shareholders describing how ...
  6. Bubble Theory

    A school of thought that believes that the prices of assets can ...
Related Articles
  1. Markets

    How Does a Bubble Form and Burst?

    A bubble forms when prices grow beyond their true value.
  2. Markets

    Economic Bubble: Toil And Trouble!

    You might like the idea of profiting from a bubble, but you’d probably like to avoid suffering from its aftermath. Here is how an economic bubble works.
  3. Markets

    Should the Fed Be More Worried About Asset Bubbles?

    While the Fed should be concerned that assets bubbles might impact economic stability, monetary policy is not the best tool to mitigate this threat.
  4. Managing Wealth

    The Myth About Market Bubbles

    Bubbles have made and ruined fortunes. Though they can be difficult to predict, understanding how they work gives you a visible advantage.
  5. Markets

    Five Of The Largest Asset Bubbles In History

    The five bubbles discussed here were among the biggest in history; their lessons should be heeded.
  6. Markets

    5 Steps of a Bubble

    In the financial sense, a bubble refers to a situation where the price of an asset far exceeds its fundamental value.
  7. Markets

    How Do Asset Bubbles Cause Recessions?

    Understand how asset bubbles often lead to deep, protracted recessions. Read about historical examples of recessions preceded by asset bubbles.
  8. Personal Finance

    6 Ways to Save on Holiday Wine and Spirits

    Get started on your planning and spending now, so you are prepared when the holiday trifecta (Thanksgiving, Christmas and New Year) hits.
  9. Investing

    Who is a Shareholder?

    A shareholder is a person, company or other entity that owns at least one share of a company’s stock.
  10. Investing

    Knowing Your Rights As A Shareholder

    We delve into common stock owners' privileges and how to be vigilant in monitoring a company.
RELATED FAQS
  1. What is an echo bubble?

    To understand the term "echo bubble", you have to understand what a bubble is. A financial or economic bubble occurs when ... Read Answer >>
  2. What do people mean when they say there is a "bubble" going on in the market, such ...

    A financial "bubble" refers to a situation where there is a relatively high level of trading activity on a particular asset ... Read Answer >>
  3. What economic factors influence corporate bond yields?

    Discover how to notice the early warning signs of a tech bubble. Like most bubbles, a rapid rise in asset values, is usually ... Read Answer >>
  4. What lessons did the tech bubble crash give to investors in the Internet sector?

    Learn how investors contributed to the dot-com bust and how Internet services and investing has changed since the market ... Read Answer >>
  5. Can the Efficient Market Hypothesis explain economic bubbles?

    Learn about the nuanced relationship between the efficient market hypothesis and economic bubbles and the requirements and ... Read Answer >>
  6. What can shareholders vote on?

    Understand the usual voting rights of common stock shareholders, along with the importance of shareholders exercising their ... Read Answer >>
Hot Definitions
  1. Put Option

    An option contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying security ...
  2. Frexit

    Frexit – short for "French exit" – is a French spinoff of the term Brexit, which emerged when the United Kingdom voted to ...
  3. AAA

    The highest possible rating assigned to the bonds of an issuer by credit rating agencies. An issuer that is rated AAA has ...
  4. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  5. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  6. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
Trading Center