• A hot IPO is an initial public offering that generates a lot of interest from the media and demand from investors.
  • Higher demand leads to a sharp increase in prices in the secondary market, which, as a rule, is not sustainable.
  • Companies engage at least one bank to provide and manage pricing, marketing, and share number and share price range decisions.
  • Demand for shares during a hot IPO exceeds the initial offer, which means that the price should be revised upwards.
  • Hot underpriced IPOs are more likely to see share prices rise once the shares start trading, while overpriced shares drop in price,