Melt Up

AAA

DEFINITION of 'Melt Up'

A dramatic and unexpected improvement in the investment performance of an asset class driven partly by a stampede of investors who don't want to miss out on its rise rather than by fundamental improvements in the economy. Gains created by a melt up are considered an unreliable indication of the direction the market is ultimately headed, and melt ups often precede melt downs.

INVESTOPEDIA EXPLAINS 'Melt Up'

Financial analysts saw the run-up in the stock market in early 2010 as a possible melt up because unemployment rates continued to be high, both residential and commercial real estate values continued to suffer and retail investors continued to take money out of stocks.



RELATED TERMS
  1. Intrinsic Value

    1. The actual value of a company or an asset based on an underlying ...
  2. Fundamental Analysis

    A method of evaluating a security that entails attempting to ...
  3. Panic Selling

    Wide-scale selling of an investment, causing a sharp decline ...
  4. Asset Class

    A group of securities that exhibit similar characteristics, behave ...
  5. Fundamentals

    The qualitative and quantitative information that contributes ...
  6. Bid Wanted

    An announcement by an investor who holds a security that he or ...
Related Articles
  1. Money Market Mayhem: The Reserve Fund ...
    Retirement

    Money Market Mayhem: The Reserve Fund ...

  2. The Fuel That Fed The Subprime Meltdown
    Personal Finance

    The Fuel That Fed The Subprime Meltdown

  3. Five Strategies For Surviving Tough ...
    Budgeting

    Five Strategies For Surviving Tough ...

  4. Economic Meltdowns: Let Them Burn Or ...
    Economics

    Economic Meltdowns: Let Them Burn Or ...

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center