Yes, selling shares in an IPO is possible before it gets listed on a stock exchange. This is often done through the Grey Market, an unofficial market for trading securities before their official listing. In the Grey Market, shares of an upcoming IPO are bought and sold among investors based on the perceived demand for the stock and the expected market price.
The Process to Sell Your IPO (How & When)
As an investor, first, you need to find a broker specialising in IPO trading. Once you have found a broker, you need to open an account with them and deposit your shares before, you can sell an order.
Here, there are some prerequisites:
- You need to specify the number of shares you want to sell and the price you are willing to sell them for.
It is important to remember that IPOs are often volatile, so the price of your shares may fluctuate quite a bit. However, if you are comfortable with the risks, selling your IPO Stock Shares can be a great way to make a profit.
Can We Sell the IPO Share Before It Gets Listed?
There are two different types of IPOs under this context:
- Underwritten: Allow you to sell your shares as soon as they get listed on the stock exchange.
- Non-underwritten IPOs: IPO In the Share Market does not allow any sales until 30 days after their listing date.
More on Selling IPO Shares!
Several factors can affect the success of an IPO, including the state of the economy, the market conditions for the stock, and the quality of the company’s management and products.
You may sell your IPO shares yourself or have an investment bank or brokerage firm sell them on your behalf. Most companies opt for the latter option, often called underwriting, where an investment bank or broker buys a large block of shares and then resells them to investors.
Speaking of Time—Hold Your IPO Before Sharing!
In the past, companies would hold their IPO and then share their earnings with the public. Nowadays, companies will share earnings before they go public. This is because it allows them to understand how investors will react to their company and their stock price when they go public.
The Bottom Line!
IPOs can be risky, but they can also be very profitable for investors who get in early. However, you must avoid over-subscribed IPOs and invest in IPOs with greater financial success possibilities. So if you have plans to invest in IPOs, do not worry! Shoonya, India’s first zero-commission broker, is here to help you.