How to Liquidate Stocks

by Steve Gregory

There are many reasons why you may decide to liquidate your stocks, such as falling market price, financial problems or to take advantage of profits from the sale of your stocks. Regardless of the reason for selling your stocks, there are several different methods that you can employ to facilitate the liquidation. Each method allows you to decide how much of your stocks you want to liquidate.

Use a stockbroker. A broker will be able to facilitate the liquidation of your stocks. You must place a sell order with the broker clearly stating how much stock you want to sell. The stock will sell for the current market value. The final amount of money you receive from the sale is reduced by the transaction and broker fees. Although you are charged fees for using a broker, it is one of the most straightforward ways to liquidate your stock.

Sell your stocks to another shareholder. Contact other shareholders in the same company directly and offer to sell them your stock. Liquidating your stock by selling them to another shareholder is advantageous because you will avoid paying broker fees. You can get a list of shareholders who are willing to purchase shares from the company's investor relations department.

Contact the investor relations department of the company that issued your stock to see if a share buyback program is in place. A share buyback program enables a company to buy shares back from its investors. This is usually done by a company to increase the number of shares that it owns. The company offers you a tender offer to repurchase your stock. Usually, the company will buy your stock at a price that is higher than the current market rate.

Allow time for a company buyout. In some cases, the company whose shares you own may be acquired by another company, in which case you are able to get a payout for your stock. If you own stock in a company that is an aggressive industry such as technology, there is a better chance that an acquisition can occur.

Warning

  • You must pay taxes on any capital gains (profits) from the sale of your stocks.

About the Author

An avid technology enthusiast, Steve Gregory has been writing professionally since 2002. With more than 10 years of experience as a network administrator, Gregory holds an Information Management certificate from the University of Maryland and is pursuing MCSE certification. His work has appeared in numerous online publications, including Chron and GlobalPost.