Are you someone who’d want to sell your shares as soon as they are allotted? Do you also not want to wait for the IPO listing? Let’s see if it is possible.
Is it possible to sell my shares before the stocks get listed?
If we look into the general terms, it is not possible to sell shares before they’re listed in the market. But you can sell your shares before listing in the grey market.
Note – Grey markets are unofficial markets where traders trade shares before their actual listing. This market depends on the demands of IPO. If the IPO is very demanding, you might be able to sell your shares in the grey market before listing.
Make sure that you trade these kinds of shares through a trusted broker. As these trades are not official, they may have extra risks.
Pre-Open IPO Sessions
The exchange board conducts a special pre-open trading session for the price discovery and demand of the IPO stocks. It is conducted just before the listing of the shares. This pre-open session runs for 45 minutes from 09:00 AM to 09:45 AM.
So, how does the pre-open session work?
The procedure of a pre-IPO session is completely different from the usual sessions where you trade in between 10:00 AM to 03:00 PM. The exchange doesn’t give a fixed price rather you have to bid at an indicative price.
- This indicative price is decided by looking at the demands of the IPO. However, you can only place orders and not actually trade for your shares during this time.
- All the orders that are placed between 09:00 AM to 09:45 AM are executed at the end, i.e., at 09:45 AM at the same price. This price is also the listing price of the IPO.
For example, you were allotted an IPO at Rs. 100. To trade this share; you would have to place your order between Rs. 75 to Rs. 175, which is the -25 to +75 range of the pre-IPO session. Suppose you place your order at Rs. 115 and your friend places the same order at 130. At 09:45 AM, the exchange tells you that the listing price of the IPO is Rs. 120. So, your friend who wants to sell her shares at Rs. 130 won’t be able to complete the deal. But your order would be executed as you placed the order at 115, and your shares would be sold at the listing price, i.e., Rs. 120.
This way, you can sell your IPO shares even before the listing of IPOs and earn good profits.
Conclusion
Pre-open IPO sessions are a very easy yet lesser-known way of gaining high profits in a short time. You can make a good profit of up to 20-30% within 45 minutes and can exit the newly listed IPO. This will also reduce the risk of losing your money.
Another way of minimizing risks and gaining good profits is analyzing the risks of a company before investing and saving the money you pay to your brokers while trading. And both of these features are offered by Shoonya. So, switch to Shoonya to trade risk-free for lifetime zero brokerage and enjoy great benefits!