Stock Price: The price for which a specific stock sells is the stock price. Health of the economy, and the trends that prevail in trading and spending, influence the stock prices. These prices also depend on financial and technical reports put by the company.
Offering Price: The price of the stock presented in the final prospectus at the time of issuing the stock is known as the offering price.
- Best Effort Arrangement: The investment banker acts as an agent trying to sell maximum possible issues at market prices.
- All-or-none Arrangement: The company withdraws the issue from the investment banker in case he fails to sell all the stocks previously issued to him.
- Negotiated Underwriting: The issuing company and the issuer negotiate the terms of issue and price.
- Firm Commitment: The underwriter buys all the stock from the company and sells it to the public.
- The company may opt for competitive bids from the investment bankers and appoint the top bidder as their undertaker.