Anchor investors: 5 things to know
1.Anchor investors are institutional investors who commit to purchasing a significant portion of shares in a company before its IPO.2.Anchor investors typically include mutual funds, foreign portfolio investors, insurance companies, and pension funds.
3.They help in price discovery by placing large bids, indicating the interest of institutional investors in the IPO.
4.They usually agree to a lock-in period, which ranges from 30 to 90 days, during which they cannot sell their shares.
5.They help provide price stability and boost investor confidence in the IPO.
Content courtesy Centre for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
This story originally appeared on: India Times - Author:Faqs of Insurances
