- Falling Knife
- A slang phrase for a security or industry in which the current price or value has dropped significantly in a short period of time. A falling knife security can rebound, or it can lose all of its value, such as in the case of company bankruptcy where equity shares become worthless.
A falling knife situation can occur because of actual business results (such as a big drop in net earnings) or because of increasingly negative investor sentiment.
As the phrase suggests, buying into a market with a lot of downward momentum can be quite dangerous. If timed perfectly, a buy at the bottom of a long downtrend can be rewarding - both financially and emotionally - but the risks run extremely high. This term implies that the investment will never be a good one again. Examples of stocks that have plummeted are plentiful; a widely-held stock can drop precipitously as the equity ownership is reduced to nothing.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
falling knife — n. A stock whose price is currently undergoing a steep or long standing decline. Example Citation: Let s look at Oak Brook based McDonald s Corp. (MCD). The stock closed Friday at $ 33.38 a share, up $ 1.38 on the week, but far off its 52 week… … New words
falling knife — noun A stock whose price has dropped rapidly … Wiktionary
catch a falling knife — verb To buy an instrument whose price is falling rapidly. Buying that stock now would be catching a falling knife. Wait until you see capitulation … Wiktionary
Falling Into Infinity — Album par Dream Theater Sortie 23 septembre 1997 Enregistrement 2 juin au 30 juillet 1997, Avatar Studios, New York Durée 78:20 Genre(s) … Wikipédia en Français
Falling into Infinity — Album par Dream Theater Sortie 23 septembre 1997 Enregistrement 2 juin au 30 juillet 1997, Avatar Studios, New York Durée 78:20 Genre … Wikipédia en Français
Falling Down — This article is about the film. For other uses, see Falling Down (disambiguation). Falling Down … Wikipedia
Knife of Dreams — infobox Book | name = Knife of Dreams orig title = translator = image caption = Original cover of Knife of Dreams featuring Perrin Aybara facing down Aes Sedai Galina Casban with Gaul and an armsman looking on author = Robert Jordan cover artist … Wikipedia
Knife juggling — This article focuses on one aspect of toss juggling. For a more general discussion of juggling, see the main article: Juggling Knife juggling is a variant of toss juggling using special knives which are thrown and caught. Although knives are… … Wikipedia
Falling Toward Apotheosis — Infobox Television episode Title = Falling Toward Apotheosis Series = Babylon 5 Caption = Season = 4 Episode = 4 Airdate = 25 November 1996 Production = 404 Writer = J. Michael Straczynski Director = David Eagle Guests = Wayne Alexander (Lorien)… … Wikipedia
Knife catcher — A knife catcher in economics is a term for a purchaser of a good at a point when the price of that good is declining sharply in value. [cite web url=http://www.slate.com/id/2181184/ title=Beware of Falling KnivesIt s tough to make money off the… … Wikipedia