Series 52: Over-allotment

Taken from our MSRB Municipal Securities Representative Qualification Examination

Definition of the term Over-allotment...

a practice where an underwriter sells more shares than will be issued at the public offering. It is a way for the underwriter to have some control over the price of the security in the after-market (after the primary offering has taken place) as well as a way to make additional money.

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Solomon Exam Prep Study Materials for the Series 52
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