10b ipoann azevedotechcrunch
10b ipoann azevedotechcrunch, recently wrote an article discussing the potential impact of the SEC’s proposed changes to the 10b-18 rule on IPOs. The 10b-18 rule allows companies to repurchase their own shares without fear of being accused of market manipulation. However, the rule has been criticized for being too restrictive and limiting companies’ ability to buy back shares.
Proposed Changes to the 10b-18 Rule
The SEC is proposing changes to the 10b-18 rule that would make it easier for companies to buy back their own shares. The proposed changes include increasing the daily volume limit from 25% to 100% of a stock’s average daily trading volume, allowing companies to buy back shares at any time during the trading day, and eliminating the requirement that companies wait until the end of the trading day to buy back shares.
Potential Impact on IPOs
Azevedo argues that the proposed changes to the 10b-18 rule could have a significant impact on IPOs. Companies going public often use share buybacks as a way to support their stock price in the early days of trading. However, under the current 10b-18 rule, companies limited in their ability to do so. The proposed changes would give companies more flexibility to buy back shares, potentially leading to more stable stock prices in the early days of trading.
Additionally, Azevedo notes that the proposed changes could make it easier for companies to go public in the first place. The ability to buy back shares more easily could make it more attractive for companies to go public, as they would have more control over their stock price in the early days of trading. However, Azevedo also notes that the proposed changes could lead to increased volatility in the market. Companies with large buyback programs could potentially move the market with their purchases, leading to increased volatility and potentially harming investors.
Conclusion
Overall, the proposed changes to the 10b-18 rule could have a significant impact on IPOs. While the changes could make it easier for companies to go public and support their stock price in the early days of trading, they could also lead to increased volatility in the market. It remains to seen how the SEC will ultimately decide on the proposed changes and what impact they will have on the market.
