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What is an initial public offering (IPO)

Initial public offering, also known as IPO or public share issuance, is a way of raising capital from public investors.

An initial public offering is the process of offering shares of a private corporation to the public in a new stock issuance. Public investors include individuals and institutional investors. Through this process, private companies will be transformed into listed companies.

After going public, private investors will be able to fully realize gains from their investment as it usually includes premiums for current private investors. It also allows public investors to take part in the offering.

After the initial public offering, the company's shares will be traded freely on the open market, and the funds will flow among public investorsonly.

Although an initial public offering has many advantages, its shortcomings can not be ignored. An IPO is expensive, and the costs of maintaining a public company are ongoing, also unrelated to the other costs of doing business. Moreover, the company becomes required to disclose financial information, this information might help competitors.

This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors.  It is provided without respect to individual investors’ financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information having regard to your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal. Moomoo makes no representation or warranty as to its adequacy, completeness, accuracy or timeliness for any particular purpose of the above content.