IPOs - Speak The Basics (Very Good Reading) (4)

Indications of interest -

Gathered by a lead underwriter from its investor clients before an IPO is priced to gauge demand for the deal.

Used to determine offering price.


Initial public offering (IPO) -

The first time a company sells stock to the public.

An IPO is a type of a primary offering, which occurs whenever a company sells new stock, and differs from a secondary offering, which is the public sale of previously issued securities, usually held by insiders.

Some people say IPO stands for "Immediate Profit Opportunities."

More cynicIt's Probably Overpriced.


"Lead underwriter -

The investment bank in charge of setting the offering price of an IPO and allocating shares to other members of the syndicate.

Also called lead manager.


Lock-up period -

The time period after an IPO when insiders at the newly public company are restricted by the lead underwriter from selling their shares.

Usually lasts 180 days.


New issue - Same as an IPO.



"By Darren Chervitz, CBS MarketWatch"