Series 79 practice questionmediumIPO Process
When building the order book during an IPO, which investor type typically has the greatest influence on price discovery?
- ARetail investors
- BInstitutional investors✓ Correct answer
- CCompany insiders
- DUnderwriter proprietary accounts
Explanation
Why B — Institutional investors
Institutional investors participate with large orders and provide critical feedback on pricing. Overestimating retail or insider influence is a common misconception.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 995+ Series 79 questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Underwriting & New Financing questions
- Which of the following is TRUE regarding general solicitation in a Regulation D Rule 506(c) offering?
- An affiliate of a listed company wants to sell restricted stock under Rule 144. Which is a condition for sales under…
- In which scenario is information permitted to be incorporated by reference in an SEC registration statement?
- Which of the following is a typical feature unique to a selected dealer agreement (SDA) as opposed to an agreement…
- Which professional is most responsible for providing a comfort letter to underwriters in support of due diligence?
- A private biotech firm is raising $12 million through a private placement under Regulation D Rule 506(c). The company…
- Which of the following investors would automatically qualify as an accredited investor under Regulation D?
- During the quiet period following an IPO, which of the following is generally prohibited for participating underwriters?