Sell Out

[sel out]

What is the definition of Sell Out?

The liquidation of a margin account by a broker after a margin call has failed to produce additional equity to bring the margin to the required level.

Using Sell Out in an Example

If an investor fails to meet the margin call by not providing additional funds or securities, the broker may initiate a sell out, where they sell the securities in the margin account to cover the shortfall and bring the account back to the required margin level.

Using Sell Out in a sentence

Due to the recent market downturn, John's investments fell below the required margin, and he couldn't add funds in time, leading his broker to execute a sell out of his positions.

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