'Capitulation' refers to a phenomenon where investors liquidate their positions during periods of extended decline in the stock price for the fear of incurring a bigger loss. This panic selling may even emerge due to margin calls and increase in futures & options (F&O) margins, etc.
On the other hand, some believe that capitulation can lead to exhaustion of selling pressure and hence provide a fresh buying opportunity. What does capitulation tell you? o The stock market is likely to see a bottom once the capitulation subsides. o Squaring off one's position during ...
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First Published: Thu, June 04 2020. 08:19 IST
