Series 79 practice questioneasyDue Diligence Defense
Which of the following best describes the quiet period after an IPO or follow-on offering?
- AA requirement that the company cannot issue new debt for 90 days post-offering
- BA period during which the underwriter can actively solicit aftermarket trades
- CThe time when company insiders are required to sell shares to the public
- DA time when underwriters and the issuer face restrictions on publishing research and making certain public statements.✓ Correct answer
Explanation
Why D — A time when underwriters and the issuer face restrictions on publishing research and making certain public statements.
The quiet period restricts research and public disclosure to prevent improper influence on the market. The trap is confusing this with lock-up or trading restrictions.
Turn it into reps
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