Definition of Shakeout:

  1. Upheaval in a market or industry due to intense competition that eliminates weaker competitors, and ends in just a few large dominating firms.

  2. A shakeout isn't a well defined term. Depending on who is using it, it can refer to a situation that sees consolidation or a situation where there is a severe correction. In broad market usage, a shakeout is simply a period of market turmoil that causes investors to pull back. Again, depending on who is talking, this situation can be described as a shakeout or a market selloff or a market correction. In technical analysis, however, a shakeout is better defined and is said to occur as a leading stock corrects in price.

  3. An upheaval or reorganization of a business, market, or organization due to competition and typically involving streamlining and layoffs.

  4. A shakeout is a situation in which many investors exit their positions in a stock or market segment at the same time, often at a loss. A shakeout is usually caused uncertainty or recent bad news circulating around a particular security or industry. Shakeouts can be quite variable in duration, but they are usually sharp in terms of the amount lost from recent highs.

Meaning of Shakeout & Shakeout Definition