Plain-English definitions, reviewed by an independent investor
IPO (Initial Public Offering)
An IPO is a private company’s first sale of shares to the public, listing it on an exchange.
An IPO is a private company’s first sale of shares to the public, listing it on an exchange.
(First public share sale; price set by banks and demand)
Why it matters
It is how startups become household-name stocks and early owners cash out.
Common confusion
IPOs are often hyped and volatile; many underperform after the initial pop.
Frequently Asked Questions
Should I buy at IPO?
Retail access is limited and pricing is set by insiders; caution is wise.
Why do IPOs pop?
Underpricing to ensure a successful debut can leave first-day gains on the table.