Deal Breaker

Definition of 'Deal Breaker'


An issue that, if left unresolved, prompts one party to discontinue discussions. A deal breaker may involve the presence of a particular requirement in a contract, or the lack of a certain provision.

Investopedia explains 'Deal Breaker'


For negotiations that are non-iterative, meaning that there is no further interaction once terms are satisfied, the parties involved can be unwilling to budge over certain issues because they know that this is their only chance at getting what they want. The presence of a deal breaker, however, helps both parties in a negotiation know how to maneuver and help determine each other's pain points.

For example, a company attempting to merge with a competitor may discover that the competitor will only let the merger proceed if a certain number of its employees are kept on board with the new venture. This may be a deal breaker for the acquiring company.


Filed Under:

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