Important IPO Terms to Know Before Investing-

What Exactly Is An IPO?
What Kinds of IPOs Are There?
IPOs: Should You Invest?
Which IPO is the best for investing?  
IPOs: How Do They Work?
How To Buy an IPO?
How Do I Participate in an IPO?
Why Do an IPO?

IPO Terms

Initial public offerings have their own specific terminology, much like everything else in the financial industry. You should be familiar with the following major IPO terms:

1. Common shares 

Ownership stakes in a public corporation that normally grants investors the right to vote and receive dividends from the company. A business sells shares of common stock when it goes public.

ipo

2. Issue cost

The cost of common stock that will be sold to investors before an IPO business starts to trade on public exchanges. commonly known as the asking price.

3. Lot dimensions

The least amount of shares that can be purchased in an IPO. You must bid in multiples of the lot size if you want to buy more shares.

ipo

4. Initial prospectus

A report produced by the firm doing the initial public offering that contains details about its operations, strategy, historical financial statements, most recent financial performance, and management. On the left side of the front cover, it contains red text and is commonly referred to as the "red herring."

5. Price range

The range of prices that the company and the underwriter will accept bids from investors for IPO shares. Generally speaking, it varies depending on the type of investment. For instance, regular investors like you can be in a different price range than qualified institutional buyers.

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6. The underwriter

The investment bank is in charge of overseeing the offering on behalf of the issuer. In general, the underwriter chooses the issue price, promotes the IPO, and allots shares to investors.



































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