IPO

An initial public offering, or IPO (Initial Public Offering), is the first public sale of a company's shares to the general public. During the IPO, the company issues shares and places them on the stock exchange, and any interested investor or investment fund can purchase securities.

During the Road Show, preliminary bids for the issuer's shares are collected. Large investors get the right to purchase shares before their official placement. Based on the collected bids, the underwriter receives information about how many shares investors are willing to buy and at what price. The underwriter, by the way, has the pre-emptive right to purchase shares before the IPO with their further resale after the placement.

If a company's IPO causes a stir, then the demand for shares may exceed the supply - this is called oversubscription of the order book. Then the company together with the underwriter decide what to do. They may increase the share price or issue additional securities.

How to participate in an IPO?

In order to participate in an IPO, you need a brokerage account. It must have a certain amount of money that you want to invest in shares. In addition, there is a minimum amount that you need to have to participate.