A B C D E-F G H I-J K-L M-N O P Q R S T U V-Z

I-J
Indication of Interest
If an investor is interested in buying an IPO, he or she will give the lead manager an order for a specific amount of stock. Since most IPOs are oversubscribed, indications of interest are usually for several times what the investor really wants. On some deals, the valuation of the IPO may be an issue. In this case an investor might give a limit order for the IPO. For example, the investor might say, "I'm in up to $15", meaning they will take shares if they are priced at $15 or less.

Initial Public Offering
This is the event of a company first selling its shares to the public. Due to unseasoned trading and lack of information, equities are often referred to as IPOs for months, if not years, following their debuts.

Insiders
Management, directors and significant stockholders are regarded as insiders because they are privy to information about the operations of a company not known to the general public. Insiders are restricted in the timing and manner in which they can dispose of shares.

IPO Plus Aftermarket Fund
This is the only mutual fund specializing in investing in IPOs. The IPO Plus Fund is managed by Renaissance Capital.

IPO Price
Individual investors often ask why the price at which an IPO starts trading is different from its offer price. This occurs because the offer price is set by the underwriters before the stock starts trading. Once the stock starts trading, the price is determined by actual supply and demand and can be higher or lower.

IPO Research
Prior to the offering, the underwriters involved in the IPO are prohibited from issuing research or recommendations. Following the IPO, the underwriter is allowed to issue a research report. These research reports are invariably positive. Renaissance Capital, through its IPO Intelligence research service, provides independent analyses of these companies. Investors can purchase individual IPO Intelligence reports to obtain information on a company prior to its IPO. Investors interested in purchasing an IPO Intelligence report can search for an IPO by company name or ticker symbol at http://www.ipohome.com/common/iposearchf.asp.

 

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