What Is a Closely Held Corporation?

Video Transcript

"You are paying more and more attention to the financial markets every day, reading more newspapers, more, listening to radio stations when they talk about financial institutions, and you're watching television more and listening when they're talking about financial institutions. This may also include a more attuned interest when you're looking at the Internet and the business section. And you're coming across phrases that you're not really comfortable with, and you're not really sure of the definitions, and one of those is, closely held corporation. Hello, I'm Robert Todd, and I'm here to answer the question, what is a closely held corporation? Well in its simplest terms, it is a corporation where there is no ready market existing for the trading of shares. Now at first blush this may seem to indicate to you that it is a small corporation, but contrare, sometimes very, very large corporations exist where there's only a small handful of business people trading in the shares of that particular corporation. And the importance is that closely held corporations are treated differently than public corporations. If you want more information, you may want to secure the advice of a lawyer specializing in the securities and exchange commission area of the law. I'm Robert Todd, and thank you for watching."