DEFINITION of 'Kicking The Tires'

A slang term for researching an investment before putting any money into it. The process of kicking the tires for a stock might include reading the company's annual report, examining the company's management, looking at its historical performance, considering the company's competitors and reading news articles about the company.

BREAKING DOWN 'Kicking The Tires'

The steps involved in kicking the tires depend somewhat on the type of investment. Someone considering putting money in a hedge fund would want to research the hedge fund manager first, while someone considering putting money in a CD would want to research interest rates available at different banks and make sure their investment would be FDIC-insured.

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