Seasoned Security

AAA

DEFINITION of 'Seasoned Security'

1. A financial instrument that has been publicly traded in the secondary market long enough to eliminate any short-term effects from its initial public offering.

2. Any security that has been issued and actively traded in the Euromarket for at least 40 days.

BREAKING DOWN 'Seasoned Security'

1. When new securities are first offered through an initial public offering (IPO), they can exhibit substantial volatility immediately following their listing. Seasoned securities have already been on the market for a while, making them more predictable than newly-listed securities due to price and trading volume stability.

2. Before the sale of a Euromarket security can be made to certain U.S. investors, the security must trade on the market for a minimum of 40 days.

RELATED TERMS
  1. Primary Distribution

    The original sale of a new security issue (bonds or stocks) from ...
  2. Story Paper

    A security or investment of any kind that has very unique or ...
  3. Generic Securities

    A security backed by recently issued loans or mortgages. Its ...
  4. Lock-Up Agreement

    A legally binding contract between the underwriters and insiders ...
  5. Underwriting

    1. The process by which investment bankers raise investment capital ...
  6. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs ...
Related Articles
  1. Fundamental Analysis

    Interpreting A Company's IPO Prospectus Report

    Learn to decipher the secret language of the IPO prospectus report - it can tell you a lot about a company's future.
  2. Investing Basics

    5 Tips For Investing In IPOs

    Thinking of investing in IPOs? Here are five things to remember before jumping into these murky waters.
  3. Retirement

    IPO Basics Tutorial

    What's an IPO, and how did everybody get so rich off them during the dotcom boom? We give you the scoop.
  4. Investing Basics

    Learn About the New York Stock Exchange

    The New York Stock Exchange (NYSE) is nicknamed the “Big Board,” and for good reason. It’s the largest, oldest and best-known stock exchange in the world.
  5. Investing

    What Rising Volatility Means for Momentum

    After remaining torpid for most of the year, equity market volatility is once again rising.
  6. Term

    Risk and Reward In Emerging Market Economies

    An emerging market economy is one that’s progressing into an advanced economy.
  7. Investing

    What Are The Three Key Elements of a Bond ETF?

    We explore the bond ETFs basics, because the only way to appreciate the benefits that this type of investment offers is to first understand how they work.
  8. Fundamental Analysis

    Explaining the Capital Market Line

    The capital market line (CML) depicts the level of additional return above the risk-free rate for each change in the level of risk.
  9. Term

    How Equity Capital Markets Work

    An equity capital market is a market existing between companies and financial institutions that raises money for the companies.
  10. Investing Basics

    List of the Major Stock Exchanges in the Caribbean

    Though the Caribbean is well-known for its beautiful beaches and vibrant music, it has an emerging capital market that should not be ignored.
RELATED FAQS
  1. How does an IPO get valued? What are some good methods for analyzing IPOs?

    The price of a financial asset traded on the market is set by the forces of supply and demand. Newly issued stocks are no ... Read Full Answer >>
  2. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  3. What is the difference between shares outstanding and floating stock?

    Shares outstanding and floating stock are different measures of the shares of a particular stock. Shares outstanding is the ... Read Full Answer >>
  4. What is the difference between market risk premium and equity risk premium?

    The only meaningful difference between market-risk premium and equity-risk premium is scope. Both terms refer to the same ... Read Full Answer >>
  5. What is the difference between the QQQ ETF and other indexes?

    QQQ, previously QQQQ, is unlike indexes because it is an exchange-traded fund (ETF) that tracks the Nasdaq 100 Index. The ... Read Full Answer >>
  6. What is the difference between an investment and a retail bank?

    The activities and types of clients for an investment bank versus those for a retail bank highlight the primary difference ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Bear Market

    A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment ...
  2. Alligator Spread

    An unprofitable spread that occurs as a result of large commissions charged on the transaction, regardless of favorable market ...
  3. Tiger Cub Economies

    The four Southeast Asian economies of Indonesia, Malaysia, the Philippines and Thailand. Tiger cub economy indicates that ...
  4. Gorilla

    A company that dominates an industry without having a complete monopoly. A gorilla firm has large control of the pricing ...
  5. Elephants

    Slang for large institutions that have the funds to make high volumes trades. Due to the large volumes of stock that elephants ...
  6. Widow's Exemption

    In general terms, a widow's exemption refers to the amount that can be deducted from taxable income by a widow, thereby reducing ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!