Liquidation

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Dictionary Says

Definition of 'Liquidation'

1. When a business or firm is terminated or bankrupt, its assets are sold and the proceeds pay creditors. Any leftovers are distributed to shareholders.

2. Any transaction that offsets or closes out a long or short position.
Investopedia Says

Investopedia explains 'Liquidation'

Creditors liquidate assets to try and get as much of the money owed to them as possible. They have first priority to whatever is sold off. After creditors are paid, the shareholders get whatever is left with preferred shareholders having preference over common shareholders.

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    Liquidation Blues: When Mutual Funds Close

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  3. An Overview Of Corporate Bankruptcy

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  4. What are the differences between chapter 7 and chapter 11 bankruptcy?

    Chapter 7 bankruptcy is sometimes also called liquidation bankruptcy. Firms experiencing this form of bankruptcy are past the stage of reorganization and must sell off any un-exempt assets to ...

  5. What does it mean when the shares in my account have been liquidated?

    An account liquidation occurs when the holdings of an account are sold off by the firm in which the account was created. In the majority of cases, this will deal with problems arising with margin ...

  6. Since stockholders are entitled to a company's assets and earnings, can a stockholder realize profits without selling stocks?

    When buying stock in a company, an investor becomes a part owner of that company. In addition to possessing the small degree of voting power that comes with being a stockholder, an investor is ...

  7. What happens to the stock of a public company that goes bankrupt?

    Occasionally, publicly listed companies go bankrupt. The company's shareholders, depending on the type of stock they hold, may be entitled to a portion of the liquidated assets, if there are ...

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