IPO Classroom

Short chapters about how IPOs work, in plain words.

1. 1What is an IPO?It is the first time a company lets ordinary people buy a small piece of it.
2. 2What does "10 times subscribed" mean?It means ten people asked for every one share the company had to give.
3. 3Why did I not get any shares?When more people ask than there are shares, names are picked in a draw. Missing out is normal.
4. 4What is GMP?A price some people quote for a share before it is listed. It is a rumour, not a fact.
5. 5What is a lot?In an IPO you cannot buy one share. You buy a fixed bundle, and that bundle is called a lot.
6. 6Who is the registrar?The company that keeps the list of who applied and decides who gets shares.
7. 7What is the cut-off price?A way of saying "whatever the final price turns out to be, I will pay it".
8. 8What is an SME IPO?The same thing, for a much smaller company, with bigger bundles and fewer rules.