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overtrade

From Longman Business Dictionary
Related topics: Trade, Finance
overtradeo‧ver‧trade /ˌəʊvəˈtreɪdˌoʊvər-/ verb [intransitive]1ACCOUNTINGCOMMERCEif a business overtrades, it does not have enough WORKING CAPITAL (=available cash) to pay its CREDITORs (=people and organizations it owes money to) and employeesDirectors of a tour operating company have to give financial guarantees which will be used if the company overtrades and then fails.2FINANCE if a BROKER overtrades, they buy and sell investments for customers more often than they should, in order to increase the amount of COMMISSION they earn SYN CHURNovertrading noun [uncountable]Before expanding, arrangements must be made for the higher cash requirements needed for this. If not, there is a risk of overtrading.The securities house imposed fines for overtrading habits that in fact were encouraged.
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