HOW ARE IPO SHARES TRADED IN GREY MARKET!
WHAT IS A GREY MARKET?
• A grey market is an unofficial market. Here goods are sold outside the official distribution channels.
• In this market, the investor trade for shares or application before the shares are officially launched for trading in the stock exchange.
• One thing to note here is that a grey market is an unofficial market, not an illegal market.
GREY MARKET STOCK & GREY MARKET PREMIUM
• Grey market stock is one where the company's share are offered and bid by traders unofficially.
• If a company introduce its stock by way of traders before the share are issued in IPO, it is consider as grey market stock.
• The amount at which the IPO shares of the grey market are traded are known as grey market premium.
• The live grey market price indicates how the IPO will react on the day of listing.
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