flotation cost

Definition

The cost of investment banking services in the underwriting of a securities offering. The services include the pricing and marketing of the issue, and the costs are scaled based on the size and type of offering.

Use flotation cost in a sentence

I wanted to know what the flotation cost was and if it would have an impact on how we were doing.

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You should try and factor in any flotation cost to your budget so that you know you have everything covered.

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The flotation cost was a necessary cost as part of the security being involved in the transaction so we paid it happily.

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