Talk:Reverse Greenshoe

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[edit] How reverse greenshoe option works

I am not able to understand this section. It is bad constructed. The second point states that the underwriter is 15% long, so it is long at the IPO price $10. So if shares fall to $8, the underwriter exercises the option to sell its shares at the IPO price, but does not buy at $8 in the market as said. Then, it is unclear how this can stabilize the price. Oriolpont (talk) 20:36, 20 November 2007 (UTC)