What is the subscription of securities?

The process of subscription of securities requires at least two participants, including a client, such as a corporation or a government entity and an investment bank. If an issuer like a company or government needs to raise money, turns to capital markets to sell its own capital or debt. For the purpose of sales, one or more investment banks are hired for the process of subscribing securities. The investment bank is responsible for subscribing these securities, a process that includes the prices, purchase and selling of these shares back to the public. Usually, several investment banking companies are hired to subscribe to securities, including the main bank and several other banks with more junior roles. Among the teams of investment banking and the company team, it decided on several financial details on the agreement, and all this is part of the investment subscription.

first must be determined by IPO size, inclEmpering the number of shares that will be issued on the stock market and the prices of these shares. The Date for IPO must also be set and often go to the road show before the bankers and management is issued and promoted the upcoming sale of shares to the public. Before the release date, investment banks buy their own capital shares at a specified price and immediately generate profits for the company. These shares are awarded the public in a larger amount for bankers in the store to earn profits as a result of securities subscription services.

Pricking is a delicate matter in the process of subscription of securities. If the shares for the public are too high, the bank will not be able to interpret these shares and will be forced in the future to try to prodat.The too low prices can result in lost profits for subscribers and the company issuing shares.

In exchange for providing securities subscription services, investment bankers have the potential to earn generous fees. These incomes are often based on the size of the transactioncarried out on financial markets. For example, a banker can earn a percentage of the total IPO value. Banker is also likely to earn a bonus at the end of the year based on the value of business brought to investment banking.