Circle

Definition:

Underwriters, actual or potential, often seek out and "circle" investor interest in a new issue before final pricing. The customer circled has basically made a commitment to purchase the issue if it is available at an agreed-upon price. If the actual price is other than that stipulated, the customer supposedly has first offer at the actual price.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Going away

The type of bond purchased by dealers for immediate resale to investors, as opposed to purchasing a bond to hold for some amount of time, and then reselling it at a future date.

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