IPO GMP is also known as Grey Market Premium. It represents the difference between the unofficial market price of a newly issued stock in the pre-listing or grey market and its official IPO offer price. It reflects investor sentiment and expectations regarding the IPO’s performance once listed on a stock exchange.
A positive GMP suggests strong demand, while a negative GMP indicates less enthusiasm. Investors often use this metric as a preliminary gauge of an IPO’s potential success, although it should be considered alongside other factors when making investment decisions.
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