An IPO indictor tool has been launched by Nasdaq to give traders better visibility of their orders during listings.
The tool will enable investors to see details of all their orders for an IPO during the pre-IPO quoting period. It will also show the number of shares and orders that would execute were the cross to occur at the indicative price and time.
Nasdaq stressed that its IPO indicator will not provide a complete view of the pre-IPO opening book, but will contain net order imbalance information, along with a firm’s own orders.
It said the tool will enable traders to be able to access more information on their order flow and make more informed trading decisions during the pre-IPO period.
The IPO indicator is available via the Nasdaq Workstation as well as Nasdaq’s new IPO Workstation, which is specifically targeted at IPO market participants and underwriters.
Back in 2012, Nasdaq market participants were left in a state of confusion over the status of their IPO orders during the botched IPO of Facebook. Technical problems prevented orders from going through, leaving investors unsure of whether or not their orders had executed.
Improve transparency of the IPO process and calls for greater automation of listings have been key concerns of the buy-side in recent years.