What Is an Indication of Interest?

An indication of interest utilized by an investor to show interest in a security that is not yet on the market. When a new security is about to be put on the market it has to register with the SEC first. With an indication of interest an investor can, along with their broker, notify the investment bank that they want to purchase the security when it is available to the market. This technique is used because it is illegal to purchase a security before it is registered with the SEC and available to the public.

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