Closely Held Shares

Definition of 'Closely Held Shares'


The shares in a publicly traded company held by a small number of shareholders, who are either directly affiliated with the company or management, or are majority stakeholder. Closely held shares are not publicly traded in the same manner as common shares. These companies may trade under light volume, since the majority of the shares can be held by a small group of shareholders. Companies that are closely held tend to be resistant to hostile takeovers, since the majority of shares are held within a small, interested group of shareholders.

Investopedia explains 'Closely Held Shares'


Closely held companies may be more stable than other companies, since share prices are determined by the company's value and not by investor sentiment. Closely held companies may not have access to the same levels of working capital as widely traded corporations, because of low trading volume. However, many companies implement both common and closely held shares.



comments powered by Disqus
Hot Definitions
  1. Cash and Carry Transaction

    A type of transaction in the futures market in which the cash or spot price of a commodity is below the futures contract price. Cash and carry transactions are considered arbitrage transactions.
  2. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  3. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  4. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  6. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
Trading Center