Ethics IPOs

first, account, position, allocated, desired

#1 Can a member ever participate in a hot IPO, or must all of clients’ desired position be satisfied before member gets the first share?
#2 Among clients who are participating in IPOs, are shares supposed to be allocated in equal numbers across clients, or can they be allocated proportionately based on account size?

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发表于 2013-4-21 16:29 | 只看该作者

Hank Moody wrote:
#1 Can a member ever participate in a hot IPO, or must all of clients’ desired position be satisfied before member gets the first share?
#2 Among clients who are participating in IPOs, are shares supposed to be allocated in equal numbers across clients, or can they be allocated proportionately based on account size?
Pg 72-73 III (B) Fair Dealing
Consequently, Standard III(B) requires that members or candidates treat all clients fairly in light of their investment objectives and circumstances. For example, when making investments in new offerings or in secondary financings, members and candidates should distribute the issues to all customers for whom the investments are appropriate in a manner consistent with the policies of the firm for allocating blocks of stock. If the issue is oversubscribed, then the issue should be prorated to all subscribers. This action should be taken on a round-lot basis to avoid odd-lot distributions. In addition, if the issue is oversubscribed, members and candidates should forgo any sales to themselves or their immedi-ate families in order to free up additional shares for clients. If the investment professional’s family-member accounts are managed similarly to the accounts of other clients of the firm, however, the family-member accounts should not be excluded from buying such shares.

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