THE PRICE IS SET: The night before the exchange listing, the price of the stock is set based on investor interest. Money is given to the company and, in exchange, investors receive shares, some portion of which will be sold on the stock market the next morning.

What determines an IPO price?

The Company's share price at the time of the IPO is determined by the valuation of the Company, divided by the total number of shares at listing.

What time are IPOs priced?

On the Nasdaq, it's also common for a new IPO stock to start trading a few hours after the opening at 9:30 a.m. ET. A stock might be released for quotation within an hour or two of opening and then be eligible for trading approximately 10 minutes later.