What is a Lock-Up Period? ?"'
What is an initial public offering lock-up period? This comes under two things;
- the first time is a lockup period for investors when they invest in a fund. If you invest in a mutual fund or hedge fund where your assets are managed by a fund manager, then you might have a lockup period - this is a redemption time that you have to give before you can withdraw your funds. This is a window of time to allow the fund manager time to properly exit some positions to fulfill client withdrawal requests.
- What Is an IPO Lock-Up Period and How Long Is It? This is a lockup period if you hold stock. Say you're involved in a company that has done an IPO. The IPO is launched and the lockup period stops share owners who are benefiting from the IPO from selling too soon. This is to protect big dumping of assets on the market straightaway.