Hot IPO

Hot IPO

An IPO that is extremely popular, leading to a dramatic rise in price immediately after the IPO. Hot IPOs are usually overbooked. They were especially popular in the 1990s during the dot-com bubble when it was common for IPOs to occur at, say, $10 per share, and almost instantly spike to $50 or $60 per share. An IPO is a risky investment in general; a hot IPO may be even riskier, especially when the company's earnings are small or non-existent, as was the case in the dot-com bubble. See also: Publicly-traded company.
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During hot IPO markets, such as the biotechnology bubble of 1999-2000, huge amounts of money was left on the table.
retail investors receiving hot IPO shares, it would allow some to
NEW YORK -- Hotel chain La Quinta rose Wednesday in its first day of trade after Blackstone Group successfully launched its third hotel stock offering since November into a hot IPO market.
GrubHub is one of four companies to go public Friday in what has been a very hot IPO market, especially for businesses in the cloud software and biotech industries.
Prior literature finds that hot IPO market issuers are of the same or lower quality than cold IPO market issuers (Ritter, 1991; Helwege and Liang, 2004).
I should disclose that I plan to invest in this company - not necessarily because I think that it will be the next hot IPO, but because I think that it exploits some interesting and accelerating trends.
Investors are less likely to truthfully reveal their demand for a hot IPO if this indication is only likely to push up the offer price.
Therefore, our study provides evidence of the effectiveness of Rule 2720 in both cold and hot IPO markets.
Boland (1980) found that during the hot IPO market of 1980 that "some underwriters and company promoters have grown shy about talking.
All of this doesn't sound like a red hot IPO (initial public offering) to me,'' Gorder said.
In a hot IPO, the book of orders will surpass the actual shares to be sold by many multiples.
2) In this market, the competition to get an allocation of shares in a hot IPO was fierce owing in no small part to the widely held perception that IPOs--especially of Internet-related issuers--would yield tremendous profits to any buyer lucky enough to get the opportunity to purchase hot IPO shares from the underwriters.