Skin In The Game

AAA

DEFINITION of 'Skin In The Game'

A term coined by renowned investor Warren Buffett referring to a situation in which high-ranking insiders use their own money to buy stock in the company they are running.

INVESTOPEDIA EXPLAINS 'Skin In The Game'

The idea behind creating this situation is to ensure that corporations are managed by like-minded individuals who share a stake in the company. Executives can talk all they want, but the best vote of confidence is putting one's own money on the line just like outside investors!

RELATED TERMS
  1. Warren Buffett

    Known as "the Oracle of Omaha", Buffett is Chairman of Berkshire ...
  2. Insider

    A director or senior officer of a company, as well as any person ...
  3. Oracle Of Omaha

    A nickname for Warren Buffett, who is arguably one of the greatest ...
  4. Service Mark

    A brand name or logo that identifies the provider of a service. ...
  5. Plant Patent

    An intellectual property right that protects a new and unique ...
  6. Patent Agent

    A professional licensed by the United States Patent and Trademark ...
Related Articles
  1. Active Trading

    Warren Buffett: How He Does It

  2. Entrepreneurship

    The Greatest Investors

  3. Investing

    What are Business Ethics?

  4. What is globalization?
    Investing

    What is Globalization?

Hot Definitions
  1. Capitulation

    When investors give up any previous gains in stock price by selling equities in an effort to get out of the market and into ...
  2. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  3. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  4. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  5. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  6. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
Trading Center