Series 79 practice questionmediumSyndicate Formation
In a traditional IPO syndicate, which entity typically handles share allocation decisions among selling group members?
- AThe issuer’s legal counsel
- BThe company’s board of directors
- CThe SEC
- DThe managing underwriter✓ Correct answer
Explanation
Why D — The managing underwriter
The managing underwriter is responsible for allocating shares to selling group members, based on demand and strategic considerations. The trap is thinking the issuer or SEC has direct involvement in allocation duties.
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