Undigested Securities
Definition of 'Undigested Securities'A new security issue that remains undistributed due to insufficient investor interest or public demand at the offering price. An underwriting group purchases a new securities issue from an issuing corporation and agrees to sell the issue for a profit to investors. Undigested securities are those new issue that have yet to be distributed even though they are available for purchase by investors. |
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Investopedia explains 'Undigested Securities'The issue could be unappealing to investors for a number of different reasons. There could be negative press surrounding the issue, current economic conditions could be dampening interest in new securities issues, an array of other financial information could be flooding the investment community to the point where the new issues simply have not been analyzed due to time constraints, and so on. Just because a security is undigested doesn't mean it is low quality. |
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