Bust Transaction

Understanding Bust

A bust is part of the boom and bust economic cycle, which involves the rapid growth of a particular sector, called a boom, followed by a rapid contraction, or the bust. A boom in one sector normally translates into an upward trend of the stock market overall, just as a bust in one sector translates into an overall downward trend

 

Alternate Definitions of Bust 

A bust can also refer to the cancellation of a trading order that a broker has already completed. The most common cause of a bust, in this sense, is when an error occurs as part of the transaction. This can include a mistake in how the order was executed, a technical error resulting in an inaccurate transaction or a misunderstanding in what was being requested of the broker. This use of the term bust also is called a break. A more common use of the term bust involves any circumstance upon which an investment reaches zero. 

 

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