What is devolvement risk?



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What is devolvement risk?

3 Answer(s)


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when issue IPO is under subscribe then banker need to buy the unsold shares, and this is devolvement risk for baker

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Devolvement is often an indication that the market currently has negative sentiments toward the issue. This negative sentiment can have a significant impact on subsequent demand.When the undersubscription of a security issue forces the underwriting investment bank to purchase unsold securities during an offering.

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Devolvement is the risk that the bank or underwirter has to buy the unsold securities in case of undersubscription