Selloff

AAA

DEFINITION of 'Selloff'

The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the value of the security.

INVESTOPEDIA EXPLAINS 'Selloff'

A sell-off may occur for many reasons. For example, if a company issues a disappointing earnings report, it can spark a sell-off of that company's stock. Sell-offs also can occur more broadly. For example, when oil prices surge, this often sparks a sell-off in the broad market (say, the S&P 500) due to increased fear about the energy costs companies will face.

RELATED TERMS
  1. Rally

    A period of sustained increases in the prices of stocks, bonds ...
  2. Oversold

    1. A condition in which the price of an underlying asset has ...
  3. Security

    A financial instrument that represents: an ownership position ...
  4. Demand

    An economic principle that describes a consumer's desire and ...
  5. Dutch Tulip Bulb Market Bubble

    One of the most famous market bubbles of all time, which occurred ...
  6. Supply

    A fundamental economic concept that describes the total amount ...
RELATED FAQS
  1. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
  2. Should investors focus more on the current yield or face value of a bond?

    Whether investors should focus more on a bond's current yield or face value largely depends on the end goals of the investments. ... Read Full Answer >>
  3. How do I calculate the expected return of my portfolio in Excel?

    The expected return of your portfolio can be calculated using Microsoft Excel if you know the expected return rates of all ... Read Full Answer >>
  4. What are the main factors that affect stocks in the telecommunications sector?

    It is tempting to think that share prices in different sectors are controlled by unique underlying principles, but this is ... Read Full Answer >>
  5. What factors are the primary drivers of share prices in the retail sector?

    The retail sector includes companies selling every consumer product imaginable and spans both traditional brick-and-mortar ... Read Full Answer >>
  6. How can I hedge my portfolio to protect from a decline in the food and beverage sector?

    The food and beverage sector exhibits greater volatility than the broader market and tends to suffer larger-than-average ... Read Full Answer >>
Related Articles
  1. Active Trading Fundamentals

    Understanding Investor Behavior

    Discover how some strange human tendencies can play out in the market, posing the question: are we really rational?
  2. Economics

    Is Your Stock Headed South?

    Don't let your portfolio go with it! Find out which signs to watch out for.
  3. Active Trading

    What Is Market Efficiency?

    The efficient market hypothesis (EMH) suggests that stock prices fully reflect all available information in the market. Is this possible?
  4. Investing Basics

    Stashing Your Cash: Mattress Or Market?

    Pulling your money out of the market may help you sleep at night, but is it a smart move?
  5. Fundamental Analysis

    American Express Returns Vs. DJ Industrial Average

    American Express has handily outperformed the Dow Jones Industrial Average since 2009, but unusual weakness in the last year is taking its toll.
  6. Investing

    The Number One Reason Why Most Traders Fail

    We show you the simple tools, availble to everyone, to succeed as an active trader: education, experience, charts, vision, and risk management systems.
  7. Investing Basics

    What Does It Mean When an Investment Outperforms?

    Stock analysts use the term “outperform” to rate a stock.
  8. Investing Basics

    How Does Dilution Work?

    Dilution refers to the reduction in the percentage equity ownership of a company due to additional equity being issued to other owners.
  9. Investing

    Looking To Begin Trading In The Stock Market?

    If you are a new trader, we explain the differences between penny stocks and options so you can make the best decision for your personal trade plan.
  10. Fundamental Analysis

    Trading With Stage Analysis

    Stage analysis offers market participants a powerful tool to identify current market conditions and make rapid adjustments to strategies.

You May Also Like

Hot Definitions
  1. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  2. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  3. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  4. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
  5. Grandfathered Activities

    Nonbank activities, some of which would normally not be permissible for bank holding companies and foreign banks in the United ...
  6. Touchline

    The highest price that a buyer of a particular security is willing to pay and the lowest price at which a seller is willing ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!