1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt).

2. The process of issuing insurance policies.


The word "underwriter" is said to have come from the practice of having each risk-taker write his or her name under the total amount of risk that he or she was willing to accept at a specified premium. In a way, this is still true today, as new issues are usually brought to market by an underwriting syndicate in which each firm takes the responsibility (and risk) of selling its specific allotment.

  1. Underwriters Association

    An industry group that is dedicated to maintaining professional standards and ...
  2. Takedown

    1. The price at which underwriters obtain securities to be offered to the public. ...
  3. Public Offering Price - POP

    The price at which new issues of stock are offered to the public by an underwriter. ...
  4. Standby Underwriting (Standby)

    A type of agreement to sell shares in an initial public offering (IPO) in which ...
  5. Core Liquidity Provider

    An underwriter or a market maker that is a sizable holder of a given security ...
  6. Automated Underwriting

    A computer-generated loan underwriting decision. Using completed loan application ...
  7. Eating Stock

    The forced purchase of a security when there are insufficient buyers. Eating ...
  8. Competitive Bid

    A step in the initial public offering process whereby an underwriter submits ...
  9. IPO Lock-Up

    A contractual caveat referring to a period of time after a company has initially ...
  10. Negotiated Underwriting

    A process in which both the purchase price and the offering price for a new ...
Related Articles
  1. Interpreting A Company's IPO Prospectus ...
    Fundamental Analysis

    Interpreting A Company's IPO Prospectus ...

  2. Wanna Be A Bigwig? Try Investment Banking

    Wanna Be A Bigwig? Try Investment Banking

  3. Can I Get Life Insurance?

    Can I Get Life Insurance?

  4. Research Report Red Flags For Brokers

    Research Report Red Flags For Brokers

  5. Tips For Fitting In At Your Brokerage ...

    Tips For Fitting In At Your Brokerage ...

  6. 5 Tips For Investing In IPOs

    5 Tips For Investing In IPOs

  7. The History Of Insurance
    Home & Auto

    The History Of Insurance

  8. Why might one insurance policy cost ...
    Home & Auto

    Why might one insurance policy cost ...

  9. Microeconomics
    Personal Finance


  10. Let Life Insurance Riders Drive Your ...
    Options & Futures

    Let Life Insurance Riders Drive Your ...

comments powered by Disqus
Hot Definitions
  1. Cash and Carry Transaction

    A type of transaction in the futures market in which the cash or spot price of a commodity is below the futures contract price. Cash and carry transactions are considered arbitrage transactions.
  2. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  3. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  4. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  6. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
Trading Center