What's the difference between liquidation and clearance?
From its definition and nature, liquidation and clearance refer to the same meaning, both of which refer to individuals or institutions selling tradable varieties such as stocks, bonds and futures in their accounts. In most cases, liquidation means selling all existing stocks at current prices, also known as clearance.
Among them, clearance refers to the operation that investors take the initiative to sell all stocks at one time. Liquidation includes active liquidation and passive liquidation. Active liquidation is to sell stocks according to the market outlook, and passive liquidation is to force securities companies to sell after reaching the liquidation conditions. Moreover, forced liquidation usually occurs in margin financing and securities lending business. After the liquidation, investors still owe money to securities companies, and securities companies will collect debts.
For investors, in the daily investment process, when a stock falls below the stop loss level, clearance is a strategic defense system. Closing positions also requires analysis of the stock market. When the stock price falls to the stop loss point, users can also directly handle the liquidation business.
There are many kinds of skills and indicators in the stock market, and investors need to analyze them to avoid losses. In addition, selling and opening positions and buying and closing positions are terms in stock investment, and stock investors can learn more about them.