BUS 422 Lecture Notes - Lecture 5: Initial Public Offering, Algorithmic Trading, Bid Price
31 Jan 2019
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Document Summary
Primary market- market for new issues of securities. Private placement- primary offerings in which shares are sold directly to a small group of institutions or wealth investors. Initial public offering (ipo)- first public sale of stock by a formerly private company. Underwriters- purchase securities from the issuing company and resell them to the public. Prospectus- a description of the firm and the security it is issuing. Dealer markets- markets in which traders specializing in particular assets buy and sell for their own accounts. Auction market- a market where all traders meet at one place to buy or sell an asset. Bid price- the price at which a dealer or other trader is willing to purchase a security. Ask price- the price at which a dealer or other trader will sell a security. Bid-ask spread- the difference between the bid and asked price.
