In an
IPO
An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
, secondary shares (in contrast to
primary shares) refer to existing shares of
common stock
Common stock is a form of corporate equity ownership, a type of security. The terms voting share and ordinary share are also used frequently outside of the United States. They are known as equity shares or ordinary shares in the UK and other Comm ...
that are sold to investors in an offering (see
Secondary Market Offering).
The selling of these secondary shares may be from existing shareholders. Since these shares do not increase the number of total shares outstanding, the offering is referred to as
"non-dilutive" (to
EPS).
capital.com
Retrieved December 18, 2020
References
{{DEFAULTSORT:Secondary Shares
Corporate finance
Stock market