Initial Public Offering

An Initial Public Offering (IPO) is the first sale of privately owned equity (stock or shares) in a company via the issue of shares to the public and other investing institutions. In other words an IPO is the first sale of stock by a private company to the public. IPOs typically involve small, young companies raising capital to finance growth. For investors IPO´s can risky as it is difficult to predict the value of the stock (shares) when they open for trading. An IPO is effectively going public or taking a company public.

Updated On: 09.10.04