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penalty bid

A fee charged by some brokerage firms when a client sells Initial Public Offering (IPO) shares immediately after purchasing them. The penalty bid is the obligation of the client's broker and is intended to discourage them from making shares available to investors whose only interest is to make a quick profit on the IPO.

Related information about penalty bid:
  1. Penalty Bid Definition | Investopedia
    A bid, or offer to purchase securities, provided by a lead underwriter or other member of a syndicate as part of early IPO trading. The bid comes with the ...
     
  2. Penalty Bid - Financial Dictionary - The Free Dictionary
    An offer to buy the security offered in an IPO with the guarantee that the buyer will retain the security for a certain period of time. If the buyer sells the security ...
     
  3. What is penalty bid? definition and meaning
    Definition of penalty bid: A fee charged by some brokerage firms when a client sells ... The penalty bid is the obligation of the client's broker and is intended to ...
     
  4. penalty bid « Solomon Exam Prep
    Exam Alert: Flipping may only be discouraged through penalty bids. "Flipping" is when a customer sells a new issue into the secondary market at a profit shortly ...
     
  5. penalty bid - Invest Definition
    penalty bid definition: A financial penalty sometimes imposed by the underwriter of a new securities issue against a broker whose customer(s) sold shares of the ...
     
  6. Penalty Bid: Definition from Answers.com
    Penalty Bid A bid, or offer to purchase securities, provided by a lead underwriter or other member of a syndicate as part of early IPO trading.
     
  7. Stabilization Activities by Underwriters after Initial Public Offerings
    the shares and also decides whether to have a penalty bid in effect. The lead manager is responsible for all of the aftermarket activities on behalf of the syndicate ...
     
  8. What is Penalty Bid? Definition and Meaning « Knowledge Base
    Penalty bid provisions may be included in underwriting contracts for initial public offerings (IPOs) in order to complement price stabilization mechanisms such as ...