Book Building

What is 'Book Building'

Book building is the process by which an underwriter attempts to determine at what price to offer an IPO based on demand from institutional investors.

BREAKING DOWN 'Book Building'

An underwriter "builds a book" by accepting orders from fund managers indicating the number of shares they desire and the price they are willing to pay.

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RELATED FAQS
  1. What does the underwriter do in a new stock offering?

    Learn the role an underwriter plays for an initial public offering, and the steps an underwriter takes in preparing for an ... Read Answer >>
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    Learn how underwriting syndicates work together when helping a company undertake an initial public offering, and learn about ... Read Answer >>
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