Churning
1. An unethical practice employed by some brokers to increase their commissions by excessively trading in a client's account. This practice violates the NASD Fair Practice Rules. It is also referred to as "churn and burn", "twisting" and "overtrading".
2. A period of heavy trading with few sustained price trends and little movement in stock market indexes. Investopedia Says:
Another negative result for the client is being stuck with higher tax bills. Related Terms:
Bucket Shop
Bucketing
Circular Trading
Front Running
Guilt Edged Investment
Jitney
National Association of Securities Dealers - NASD
Portfolio Pumping
Pump and Dump
Wrap Account |