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Board Of Trade Initial Public Offering Article
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Beware of Possible Initial Public Offering Scandal and Protect your Investing Career
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Successful investors are knowledgeable about the “ins and outs” of the market. Aside from understanding the basics that surrounds the world of business venture, successful investors are knowledgeable about the moral conduct and implications of their conduct towards their business venture. In other words, in order to succeed on a particular investment, an investor must swear before his colleagues that he will conduct his business in a morally-upright way and within fair competition.
Let us take a look on the first characteristic of a successful investor. As mentioned earlier, he must be knowledgeable about the basics of business venture. He knows what are the things he needs to do before getting into business (business plan, appropriate strategies, advertising and public relation plans, and others) and how he will act appropriately on certain circumstances (such as shortage in production, increased business risk due to debt, and bankruptcy).
Supposedly you are in the situation wherein you need additional finances to sustain the increasing growth of your business operation. Where will you get such finances? Definitely, it is not ideal to borrow additional capital through lending institutions. The profit that you can generate from expanding your business operation will just be used to pay your creditors. Instead of profit, you will end up break-even (no loss, no gain). The efforts you have given are just wasted.
So how will you act appropriately on such circumstances? A successful investor will instead resort to going public, or what you called in the finance industry as “initial public offering”.
Initial public offering or IPO refers to the first sale of a company’s common shares to the public. Its principal purpose is to raise additional capital that will be used to sustain the growing expenditures of a particular company. It typically involves several investment banks that will act as the underwriters for the whole process. The company as the issuer will draft a prospectus containing all the necessary information about the company itself (background, history, financial status, and others) and will be submitted to the Securities and Exchange Commission for approval.
Once approved and the prices of the common shares are now finalized, such shares will undergo the free riding period wherein it will now be offered for sale to the public through various ways such as institutional visits and others.
Let us take a look on the second characteristic of a successful investor and then relate it to the conduct of the IPO process. If you think that scandal is just within the premises of the White House or within the legislative halls of the United States Congress, you are quite mistaken, for scandals also happens within the IPO process.
Nowadays, going public is no longer an automatic decision because of the scandals that have changed the landscape for IPO. Most of the personalities involved in such scandals turned out to be the losers now because of their immoral acts just to generate more profit out of the IPO process.
Want to know some of the corporate scandals that happened in IPO process? Take a look on the following:
• When AOL Time Warner went public in July 2002, the free riding period during the IPO process faltered, resulted to barter deals just to compensate the losses incurred, which is against the finalized price arrangements of their common shares.
• When Enron went public in October 2001, several corporate officials used illegal methods of acquiring wealth out of the IPO process by improper usage of off-the-books partnerships, bribed foreign government officials and representatives to win international contracts, and manipulated Texas and California energy markets. It resulted to the court conviction of their former corporate executives.
These are just two of several initial public offering scandals that happened during the recent years. Now, do you want to be a successful investor? If you want, then use the scandals happened as a moral lesson and do not commit the same mistakes or it will be the end of your investing career.
Board Of Trade Initial Public Offering Specific links
Board Of Trade Initial Public Offering News
CBOE says aims to launch new C2 platform in August - guardian.co.uk
CBOE says aims to launch new C2 platform in August guardian.co.uk, UK - See: [ID:nN06442890] A court ruling would allow CBOE to continue as a for-profit shareholder-owned firm, conduct an initial public offering, or consider a ... |
Brodsky optimistic CBOE will be public this year - Crain's Chicago Business
 Crain's Chicago Business | Brodsky optimistic CBOE will be public this year Crain's Chicago Business, IL - The CBOE is a member-owned organization, an anachronistic ownership structure that has prevented it from floating shares in an initial public offering or ... CBOE chief optimistic on demutualization progress CBOE Hopes For Demutualization Ruling In 2 To 4 Weeks |
71 Capital Corp. Announces Closing of Initial Public Offering - MarketWatch
71 Capital Corp. Announces Closing of Initial Public Offering MarketWatch - P) is pleased to announce that it has completed its initial public offering of 3050600 common shares at the price of $0.10 per common share for total gross ... |
Seligman LaSalle International Real Estate Fund, Inc. Announces ... - MarketWatch (press release)
Seligman LaSalle International Real Estate Fund, Inc. Announces ... MarketWatch (press release) - ... equal to 1.75% of the Fund's initial public offering price of $25.00, or approximately 7% on an annual basis (the "Level Distribution Policy"). ... |
10-Q: SABA SOFTWARE INC - MarketWatch (press release)
10-Q: SABA SOFTWARE INC MarketWatch (press release) - The sales and marketing category of operating expenses also includes sales commissions and expenses related to public relations and advertising, trade shows ... |