Delisting

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DEFINITION of 'Delisting'

The removal of a listed security from the exchange on which it trades. Stock is removed from an exchange because the company for which the stock is issued, whether voluntarily or involuntarily, is not in compliance with the listing requirements of the exchange.

BREAKING DOWN 'Delisting'

The reasons for delisting include violating regulations and/or failing to meet financial specifications set out by the stock exchange. Companies that are delisted are not necessarily bankrupt, and may continue trading over the counter.

In order for a stock to be traded on an exchange, the company that issues the stock must meet the listing requirements set out by the exchange. Listing requirements include minimum share prices, certain financial ratios, minimum sales levels, and so on. If listing requirements are not met by a company, the exchange that lists the company's stock will probably issue a warning of non-compliance to the company. If the company's failure to meet listing requirements continues, the exchange may delist the company's stock.

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RELATED FAQS
  1. What are the rules behind the delisting of a stock?

    The criteria to remain listed on an exchange differs from one exchange to another. On the New York Stock Exchange (NYSE), ... Read Full Answer >>
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    The most recognized transition between the private and public markets is an initial public offering (IPO). Through an IPO, ... Read Full Answer >>
  3. I own shares of a company that just received a delisting notice from Nasdaq. Does ...

    Let's start by walking through the reasons for listing requirements and what happens when a company's stock is delisted from ... Read Full Answer >>
  4. If a stock is delisted, do shareholders still own the stock?

    If a company has been delisted, it is no longer trading on a major exchange, but the owners of the company shares are not ... Read Full Answer >>
  5. Why did my stock's ticker symbol change?

    W hen a ticker symbol changes it's usually not a good sign. Tickers of publicly traded companies generally only change for ... Read Full Answer >>
  6. How do I buy an over-the-counter stock?

    The process of purchasing over-the-counter (OTC) stocks is different than purchasing stock from companies on the NYSE and ... Read Full Answer >>
  7. What are reverse stock splits?

    A reverse stock split is a corporate action in which a company reduces the number of shares it has outstanding by a set multiple. ... Read Full Answer >>

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