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Have you ever wondered how companies become publicly traded on the stock market? Let's demystify the process of listing shares!
What is Listing?
Listing is the process through which a company makes its shares available for trading on a stock exchange. It's like opening the doors of ownership to the public.
How Does it Work?
Preparation: Before listing, a company needs to meet certain financial and regulatory criteria. This ensures transparency and protects investors.
Initial Public Offering (IPO): The company issues shares to the public for the first time through an IPO. Investors buy these shares, providing capital to the company.
Stock Exchange: The company's shares are then listed on a stock exchange, like the New York Stock Exchange (NYSE) or NASDAQ. This makes them tradable among investors.
Example: XYZ Corporation
Imagine XYZ Corp., a tech company, decides to go public. They meet financial standards, launch an IPO, and issue shares. Now, investors can buy and sell XYZ Corp. shares on the stock exchange.