The Sampsons are considering investing in an IPO of a high tech firm, since they have heard that the return on IPOs can be very high. Advise the Sampsons on this course of action.
Answer to relevant QuestionsWhat are stock exchanges? How do they facilitate the trading of stocks? What is inflation? How is inflation measured? How does inflation affect stock prices? How is the market for a stock created? How do brokerage firms expedite this process? Compare the two types of brokerage services. When an investor sells a bond in the secondary market before the bond reaches maturity, what determines the return on the bond? How do interest rate movements affect bond returns in general? What is a call feature on a bond? How will a call feature affect investor interest in purchasing the bond?
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