The involuntary sale of an asset or position by a broker or other entity to cover outstanding debts or margin deficiencies.
Forced liquidation is the process where an asset is sold against the owner's wishes, typically by a brokerage firm or lender, to satisfy a debt or margin requirement. This often happens when an investor's account value drops below a certain threshold, and they fail to meet a margin call. The sale is usually executed quickly to mitigate further losses, which can lead to prices being depressed further.