Dead Money

DEFINITION of 'Dead Money'

A slang term for money invested in a security with minor hopes of appreciation or earning a return. The stock may also be referred as dead money by analysts, as a warning to investors who might purchase the shares.

BREAKING DOWN 'Dead Money'

Funds that are not earning interest or income are known as dead money. Some investors will hold a stock despite recent price drops, hoping that it will turn around and earn back some of the lost value. However, if the investment is dead money, the likelihood of a turnaround is low, and investors should consider selling the shares before incurring additional losses.

RELATED TERMS
  1. Cramer Bounce

    The sudden overnight appreciation of a stock's price after it ...
  2. Bear

    An investor who believes that a particular security or market ...
  3. Depreciation

    1. A method of allocating the cost of a tangible asset over its ...
  4. Appreciation

    An increase in the value of an asset over time. The increase ...
  5. Analyst

    A financial professional who has expertise in evaluating investments ...
  6. Value Investing

    The strategy of selecting stocks that trade for less than their ...
Related Articles
  1. Active Trading Fundamentals

    Guide to Short Selling

    Want to profit on declining stocks? This trading strategy does just that.
  2. Active Trading Fundamentals

    When To Short A Stock

    Learn how to make money off failing shares.
  3. Active Trading Fundamentals

    The Short And Distort: Stock Manipulation In A Bear Market

    High-quality stock reports needn't be confused with stock manipulators' dramatic claims.
  4. Options & Futures

    What Does Quadruple Witching Mean?

    In a financial context, quadruple witching refers to the day on which contracts for stock index futures, index options, and single stock futures expire.
  5. Professionals

    Is A Stockbroker Career For You?

    Becoming a stockbroker requires a broad skill set and the willingness to put in long hours. But the rewards can be enormous.
  6. Investing Basics

    How to Pick A Stock

    The first step in picking stock is to determine your goals.
  7. Investing Basics

    5 Tips On When To Buy Your Stock

    Buying stocks that make you money can be a satisfying experience for a variety of reasons, not the least of which is the impact it has on your bottom line.
  8. Investing

    Where to Ride Out the Volatility

    The one word that characterizes financial markets today: volatile. Take a look at these three considerations.
  9. Stock Analysis

    The Top 5 Micro Cap Telecommunication Stocks for 2016 (CLFD,LMOS)

    Identify and learn about five of the best micro-cap telecommunications stocks to consider for your diversified portfolio for 2016 and beyond.
  10. Investing News

    Can Oil Sink More? Experts Give Mixed Opinions

    Plummeting oil prices are the gift that keeps on giving. Not. BlackRock's Larry Fink is among those who say we haven't hit rock bottom.
RELATED FAQS
  1. What is dead money?

    Dead money is a common term used on Wall Street to describe money that does not earn a return for an investor. It could be ... Read Full Answer >>
  2. Where do penny stocks trade?

    Generally, penny stocks are traded through the use of the Over the Counter Bulletin Board (OTCBB) and through pink sheets. ... Read Full Answer >>
  3. Where can I buy penny stocks?

    Some penny stocks, those using the definition of trading for less than $5 per share, are traded on regular exchanges such ... Read Full Answer >>
  4. How does the stock market react to changes in the Federal Funds Rate?

    The stock market reacts to changes in the federal funds rate in various ways depending on where it is in the business cycle. ... Read Full Answer >>
  5. What are the requirements for being a Public Limited Company?

    The requirements for an entity to be considered a public limited company (PLC) include registration requirements, establishing ... Read Full Answer >>
  6. How do I place an order to buy or sell shares?

    It is easy to get started buying and selling stocks, especially with the advancements in online trading since the turn of ... Read Full Answer >>
Hot Definitions
  1. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
  2. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  3. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
  4. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, many new (smaller-scale) Ponzi schemers became exposed. Ponzimonium ...
  5. Quarterly Earnings Report

    A quarterly filing made by public companies to report their performance. Included in earnings reports are items such as net ...
Trading Center