What Is Shock Therapy? In economics, shock therapy theorizes that sudden, dramatic changes in national economic policy can turn a state-controlled economy into a free-market economy. Shock therapy is intended to cure economic maladies—such as hyperinflation, shortages, and other effects of market controls—to jump-start economic production, reduce unemployment, and improve living standards. However, shock therapy can
What Is a Shoestring? The slang term “shoestring” often describes a small amount of money which may be an inadequate amount to fund the intended purpose of its use in full. The budgeting process is where the term will most frequently appear, as in a “shoestring budget” or alternately as “on a shoestring.” Examples of
What is Shogun Bond? Shogun bond is a type of bond that is issued in Japan by foreign entities, including corporations, financial institutions and governments, and denominated in a currency other than yen. Key Takeaways A Shogun Bond is a bond issued in Japan by a foreign entity in a currency other than the yen.Foreign currency
What Is a Shooting Star? A shooting star is a bearish candlestick with a long upper shadow, little or no lower shadow, and a small real body near the low of the day. It appears after an uptrend. Said differently, a shooting star is a type of candlestick that forms when a security opens, advances significantly
What Is a Short (or Short Position) A short, or a short position, is created when a trader sells a security first with the intention of repurchasing it or covering it later at a lower price. A trader may decide to short a security when she believes that the price of that security is likely
What Is a Short Hedge? A short hedge is an investment strategy used to protect (hedge) against the risk of a declining asset price in the future. Companies typically use the strategy to mitigate risk on assets they produce and/or sell. A short hedge involves shorting an asset or using a derivative contract that hedges
What Is a Short Refinance? Short refinance is a financial term that refers to the refinancing of a mortgage by a lender for a borrower currently in default on their mortgage payments. Lenders short refinance a mortgage in order to help a borrower avoid foreclosure. Typically, the new loan amount is less than the existing
What Is a Shortage? A shortage, in economic terms, is a condition where the quantity demanded is greater than the quantity supplied at the market price. A shortage can be contrasted with a surplus. Key Takeaways A shortage is a condition where the quantity demanded is greater than the quantity supplied at the market price.There
What Is Short and Distort? Short and distort refers to an unethical and illegal practice that involves investors shorting a stock and then spreading rumors in an attempt to drive down its price. Such a practice, most often employed by stock manipulators who trade daily via the internet, involves the spread of unsubstantiated rumors and
What Is a Short Call? A short call is an options position taken as a trading strategy when a trader believes that the price of the asset underlying the option will drop. Therefore, it’s considered a bearish trading strategy. Short calls have limited profit potential and the theoretical risk of unlimited loss. They’re usually used
