Greensheet

DEFINITION of 'Greensheet'

A document prepared by an underwriter to summarize the main components of a new issue or initial public offering (IPO). A greensheet is an internal marketing document that is compiled by a new issue's underwriter and intended for distribution to brokers and institutional sales desks of the underwriting firm.

The purpose of a greensheet is to prepare salespeople to effectively market a new issue to the public and to determine which clients may be interested in becoming large volume buyers of the new issue. Greensheets provide only an introduction to a new security issue and are not intended to be comprehensive in nature.

BREAKING DOWN 'Greensheet'

A greensheet, by law, contains only information that would appear in the issue's prospectus. Greensheets are for intended for public distribution, and are meant for the sole use of the underwriting firm's employees. A greensheet's disclosure explains the purpose of the document, the restrictions on its distribution, the limitations on the information it contains, and a statement that specifies that the information is not a solicitation of securities.

RELATED TERMS
  1. Underwriting Agreement

    A contract between a group of investment bankers who form an ...
  2. Underwriter

    An underwriter is a company or other entity that administers ...
  3. Underwriting Spread

    The spread between the amount underwriters pay an issuing company ...
  4. Underwriting Risk

    The risk of loss borne by an underwriter. Underwriting risk generally ...
  5. Negotiated Sale

    A method of offering municipal bonds or similar financial instruments ...
  6. Underwriting Group

    A temporary association of investment bankers who wish to purchase ...
Related Articles
  1. Investing Basics

    What is Underwriting?

    Underwriting is a term most often used in investment banking, insurance and commercial banking. Generally, underwriting means receiving a remuneration for the willingness to pay for or incur ...
  2. Bonds & Fixed Income

    Basics Of Federal Bond Issues

    Treasuries are considered the safest investments, but they should still be analyzed when issued.
  3. Economics

    What Does an Underwriter Do?

    In the investment world, an underwriter is a company that helps corporations or other issuing bodies distribute their securities.
  4. Investing Basics

    What is a Greenshoe Option?

    A greenshoe option is a provision in an underwriting agreement that allows the underwriter to buy up to 15% of the shares in an IPO at the offer price.
  5. Retirement

    IPO Basics: Don't Just Jump In

    Let's say you do get in on an IPO. Here are a few things to look out for. No History It's hard enough to analyze the stock of an established company. An IPO company is even trickier to analyze ...
  6. Investing

    Top 6 Performing IPOs of 2015 (ONCE, GBT)

    2015 has produced a mixed year for initial public offerings, with small biotechs overcrowding the winner’s list.
  7. Brokers

    Uncovering The Securities Firm

    Learn about the various departments of a securities firm and the professionals who make it work.
  8. Investing Basics

    How Effective Is The Chinese Wall?

    Because underwriters work on one side of the Chinese wall and analysts work on the other side, information gathered by the underwriters is not supposed to be shared with analysts.
  9. Investing Basics

    5 Tips For Investing In IPOs

    It’s not easy to profit from IPO​s, but the money is there.
  10. Fundamental Analysis

    Top Reasons IPO Valuations Miss The Mark (MS, ZNGA)

    The costly services of investment banks don’t necessarily guarantee accuracy in IPO pricing.
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 >>
  2. How do I become an underwriter?

    Learn about the education, training and certification required to become an insurance underwriter as well as the important ... Read Answer >>
  3. What is real estate underwriting?

    See how underwriters for major lenders scrutinize real estate loans and manage their risk, and learn the origin of the term ... Read Answer >>
  4. What is the difference between an IPO and a seasoned issue?

    Learn how companies issue IPO securities when they first go public and seasoned issue shares if they sell more shares in ... Read Answer >>
  5. How does an underwriter syndicate work together on an initial public offering (IPO)?

    Learn how underwriting syndicates work together when helping a company undertake an initial public offering, and learn about ... Read Answer >>
  6. What is the difference between underwriting and investment income for an insurance ...

    Learn more about insurance companies' investment and underwriting incomes. Read about how investment incomes and underwriting ... Read Answer >>
Hot Definitions
  1. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  2. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  3. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  4. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  5. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  6. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
Trading Center