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.

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  1. In an IPO, who is a greensheet distributed to and for what purpose?

    One of the most talked about documents that arises in the process of introducing a new issue is the greensheet. This is an ... Read Full Answer >>
  2. When did Facebook go public?

    Facebook, Inc. (NASDAQ: FB) went public with its initial public offering (IPO) on May 18, 2012. With a peak market capitalization ... Read Full Answer >>
  3. Can mutual funds invest in IPOs?

    Mutual funds can invest in initial public offerings (IPOS). However, most mutual funds have bylaws that prevent them from ... Read Full Answer >>
  4. What kind of assets can be traded on a secondary market?

    Virtually all types of financial assets and investing instruments are traded on secondary markets, including stocks, bonds, ... Read Full Answer >>
  5. Why would a company decide to utilize H-shares over A-shares in its IPO?

    A company would decide to utilize H shares over A shares in its initial public offering (IPO) if that company believes it ... Read Full Answer >>
  6. How do I place a buy limit order if I want to buy a stock during an initial public ...

    During an initial public offering, or IPO, a trader may place a buy limit order by choosing "Buy" and "Limit" in the order ... Read Full Answer >>

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