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DEFINITION of 'Sell'

The process of liquidating an asset in exchange for cash. The term "sell" generally refers to the act of exiting a long position in an asset or security. In investment research, "sell" refers to an analyst's recommendation to close out a long position in a stock because of the risk of a price decline.

BREAKING DOWN 'Sell'

Since the act of selling an investment crystallizes a profit or a loss, depending on the initial purchase price, it may have tax implications for the investor.

Selling is often disdained by long-term "buy and hold" investors in the belief that market averages usually have positive performance over a prolonged period of time. But selling may actually be a prudent course of action in many situations, especially when it needs to be done to rebalance an investment portfolio.

As far as investment research is concerned, the relative dearth of "Sell" ratings by sell-side analysts at broker-dealers is often cited as an example of their lack of objectivity in research.

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