What is ‘Taking The Street’
A slang phrase referring to the hedge fund tactic of buying large amounts of a particular stock from banks and brokers in an effort to clean out these institutions’ inventory in a short period of time.
Explaining ‘Taking The Street’
Traders will do this knowing that these institutions, being market makers, will have to replenish their inventories by buying stock on the open market, which usually drives up the price of the stock. Once the price has increased, the traders will sell the stocks at a gain, often back to the same banks and brokers from whom the stocks were originally bought.
Further Reading
- The interrelations of finance and economics: Theoretical perspectives – www.jstor.org [PDF]
- Chasing the Greased Pig Down Wall Street: A Gatekeeper's Guide to the Psychology, Culture, and Ethics of Financial Risk Taking – heinonline.org [PDF]
- Financial expertise of the board, risk taking, and performance: Evidence from bank holding companies – www.jstor.org [PDF]
- Corporate financing decisions when investors take the path of least resistance – www.sciencedirect.com [PDF]
