Posted in Finance, Accounting and Economics Terms, Total Reads: 299
Stuckholders are owners of a stock who are 'stuck' with it and can't sell the stock as there are no buyers or there is a trading restriction currently.
Suppose there is an enterprise named ABC which is a listed company. Due to some discrepancies, the regulator imposes a ban on the trading of company for few days in the market. The shareholders would panic, now as soon as the ban would go everyone would want to sell the share but no one would be buying it. This means they are stuck with these shares which are losing value every minute they are not sold.
• There are no advantages to it.
• The owner of stock faces a huge loss in the valuation of his assets.