金融业导论 OUTCOME.docxVIP

Please give the operation of the LSE as a primary market for shares.? Primary market is new issues market? new issues market deals with/issues new securities in return for capital? government also uses market for selling securities? market brings lenders and borrowers together encouraging those with funds to invest to buy company shares? investors hope to benefit from long term share price growth and from regularreceipt of company profits (dividends)? companies can use funds for medium and long term investment such ascompany expansion, acquisitions of other businesses or debt consolidation? merchant banks play important role in assisting companies to come to the marketThen what is an IPO? What is the Procedure for Issuing an IPO? What are the advantages and disadvantages of issuing shares? a) Initial Public Offerings is the first sale of a corporations common shares to public investors. The main purpose of an IPO is to raise capital for the corporation.b) prospectusFirst, IPO company must submit a prospectus to the regulatory commission, only when the prospectus passed, the company was allowed to continue to Public offerings.Road ShowAnd then the company need to publicize themselves to the public through Road Show.Venture Capitalist invest in IPOAfter the road show, some companies or financial institution investors will be interested in the IPO Company. They would invest in the company as a Venture Capitalist.UnderwriterAnd one of the financial institutions may be employed for the IPO company Underwriter.All stocks are sold to the marketThe underwriter would be responsible for the work during the list of all the new stocks and the sale to the markets.If the stock is not all sold out, underwriters need to buy all of this unsold shares or to be irresponsible.c) advantages of issuing shares1.Raise their name recognition on the domestic and international markets and improving the company image. Company can earns prestige from being listed 2.Broaden the channels for inve