Issue Stock
Corporations issue shares of stock to raise money for their business. The shares that are issued represent the amount of money invested by the shareholders in the company. Shareholders have an ownership stake in the company and enjoy certain rights, such as voting rights and the receipt of dividends.
Why is it important? Companies have to invest in themselves.
The old maxim: “you need to spend money to make money.” If a company doesn’t issue stock or bonds, it will need other ways to capitalize, or will fail to launch.
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Finance: What is a hot issue?2 Views
Finance allah shmoop What is ah hot issue All right
Well it's one that has demanded more than it is
supplied One that is loved more than it is hated
One that is hot more thin it's gold Well the
most common hot issue in the press You read about
all the time Yeah It's an aipo that everybody wants
Why Well it's basically free money to the investors Price
talk has been ten to twelve dollars a share And
well then it looks like it's moved twelve to fifteen
and out price doc's fifteen to eighteen a share And
traders are mumbling that the first actual traded print will
be something like forty dollars a share So anyone who
buys at that eighteen dollars price or really any price
upto thirty thirty two thirty five something like that Well
they'll make a massive return for one day's work just
flipping their stock Tio you no longer term holders I
think about the real estate show where they flip houses
you know Well they have to do a whole lot
of work to flip a house on stocks are a
lot easier Well why do hot issues even happen Well
often banks purposely underprice i pose to quote pay the
street unquote for taking risk and buying that aipo handsomely
like they price it low Lots of people are going
to buy it have a low cost basis and remember
it fondly Well cos generally play along instead of selling
say thirty forty fifty percent of themselves to the public
in there i po well they only sell ten percent
and later on they'll sell more when the stock is
popped and traded and settled and has a buying public
and all the other good things that go with it
so and only a tiny amount of shares out there
trading even modest demand can drive prices to the sky
and this phenomenon happens Ah lot ebay snap facebook A
whole bunch of others essentially created hot issues by offering
very tiny fractions of ownership of themselves to the public
in there i po so that the enormous buyer interest
almost guarantees more demand than supply of the security being
sold and hot issues as you guess our great well 00:02:03.51 --> [endTime] until they're not
Up Next
When-issued is a trading condition that applies to structural changes in companies that result in a new entity with its own set of trading rules.
What are shares outstanding? The total size of the pie. All of the shares outstanding comprise the total votes and value of a given company. If XYZ...