| In this stock market guide I am going to be teaching | | | | everything it can to promote the stock before it |
| you all about IPO's. This stands for initial public | | | | goes public. |
| offering and it is the first sale of a companies stock | | | | · Finally the stock is listed, sold and the company |
| to the public. An IPO can also be referred to as, | | | | collects its money |
| "Going public". | | | | Getting in on an IPO is extremely difficult if you are |
| Stock market guide - IPO's. | | | | not on the inside. The investment bank will usually sell |
| An IPO is done through a process called underwriting | | | | the shares to its biggest clients first and small |
| and it is done like this. | | | | investors are definitely not considered. If you want |
| · First the company will hire an investment bank, | | | | to buy an IPO you should consider the following. |
| you can think of the investment bank as a | | | | · Because this is a newly listed company there is no |
| middleman between the company and public. | | | | historical data, this makes it very hard to analyze |
| · The bank and company will then negotiate the | | | | these companies. |
| terms of the IPO, they will discuss things such as the | | | | · After the stock is issued there is a lock up period, |
| amount of money the company wants to raise, what | | | | this means that you cannot sell your stock for a |
| kinds of stocks they will issue and other details of | | | | period of time (usually 3-24 months) |
| the deal. | | | | · Many people buy IPO's to flip them, this is when |
| · Once everything is worked out the investment | | | | they sell the stock a few days after buying it to |
| bank will submit a registration certificate to the SEC. | | | | earn a fast profit. |
| This statement contains company information such | | | | · Underwriters are essentially salesmen; they will |
| as financial statements, management details, what | | | | hype and promote the stock as much as they can. |
| the money will be used for and how much stock the | | | | Take everything they say with a grain of salt. |
| company insiders will be buying. | | | | This ends my stock market guide on IPO's, if you |
| · If the SEC approves the IPO a date is set when it | | | | enjoyed this guide and would like to learn more about |
| will be sold to the public. | | | | the stock market please visit my website by |
| · The investment bank will then send out a | | | | following the links below. |
| prospectus to potential investors, it also does | | | | |