if you apply for more no of shares in an IPO, Do we stand good chance in allocation of shares to us?
Wilton asks:
Basically elaborate more on
1. “how the company allots shares
to the retail investors”. after an IPO?
Basically elaborate more on
1. “how the company allots shares
to the retail investors”. after an IPO?
Related questions:
- Reliance IPO: Will Full payment will be given more preference than Part payment while allocation of shares? Garry asks: I know the pos and cons of a part payment. However i wonder whether the FULL PAYMENT will...
- Co-op IPO: Guaranteed minimum allocation of shares Verona asks: Co-op IPO ...
- how many shares does a company usually go public with? Shakira asks: I have the chance to buy some pre-ipo shares in a company that is planning to go public...
- If any person want to start a company, then can he raise his shares in markets and if he can what’s IPO? Ghislaine asks: As we know , a company can offer IPO (initial public offer)only if that company is a public...
- How/where do I apply for shares from the IPO of Reliance power? Jackeline asks: I am a British citizen, currently in India and am keen to buy the share. I have searched...
No not necessarily.
If issue is under subscribed, every one gets shares according to his application.
If issue is oversubscribed but not heavily, they allot shares proportionately but in the decided lot size.
If issue is heavily oversubscribed, different lots of applicants are made and among such lots, the allotees are decided by system like lottery.
Number of shares in IPO has not effect on what would be allocated to retail investors.
The real question are how much money does the company want to raise, how much do they want each share to be.
Before IPO, internal management, VCs, broker-dealer (banker) establish price, total number of shares, rules for insiders and what percentage of the company each insider/party would own the rest would be release to general public.
For example if the company is valuated at $10k and there are 100 shares each share is $100. If insiders holds 60% of the company they will own 60 shares and 40 shares are available to the public at $100 a share.
If the $10k company has 1000 shares, then each share is worth $10 then the insiders wold have 600 shares and 400 shares are available to the public at $10 a share.
Share price will go up and down base on the demand (spectulation) at the open market.
Best wishes.
hi check this link its good
buyingandsellingshares.blogspot.com/
.