Series 7 Exam Question 344: Answer and Explanation

Question: 344

The first time a company ever issues securities is called a(n)

• A. IPO
• B. first market trade
• C. rights offering
• D. None of the above

Correct Answer: A

Explanation:

A. An IPO (initial public offering) is the first time a corporation ever sells securities to the public. A first-market trade is a trade of exchange-listed securities trading on an exchange. A rights offering is when a company offers new shares to existing shareholders at a discount.