green shoe

Definition

A provision in an underwriting agreement which allows members of the underwriting syndicate to purchase additional shares at the original. This is a useful provision for underwriters in the event of exceptional public demand. The name comes from the fact that Green Shoe Company was the first to grant such an option to underwriters. also called overallotment provision.

Cite this definition


Related Research Articles from the InvestorGuide.com University

Investment Choices
An overview of the different types of investment choices available to the potential investor. Learn about short and long term investments, stocks, bonds, and mutual funds.

Initial Public Offerings
What happens when a company decides to go public and sell stock? Learn about the reasons for an IPO, why performance matters, and how you can make money off the IPO market.

Buying and Selling
Learn the best time to buy or sell an investment. Also suggests templates for investment analysis and transaction records.


Featured Sponsor


Give this definition a rating from 1 to 5 (5 being the best)...
1    2    3    4    5    
Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Add this Glossary to your Site | Bookmark InvestorWords.com
Home | Terms by Subject | Keyword Advertising | About Us | Contact Us
Work for InvestorWords.com
BusinessDictionary.com | InvestorGuide.com | WebFinanceInc.com
Disclaimer and Copyright©

Copyright©1997-2008 by WebFinance, Inc. All Rights Reserved.
Unauthorized duplication, in whole or in part, is strictly prohibited.