Devolvement poses substantial risk for the underwriting investment bank. When it is required to purchase unsubscribed shares of an issue, it will often purchase the stock at a higher-than-market-value price. Because demand is lower than anticipated, there are few buyers for the security at its issued value. Typically, the investment bank will not hold onto the floundering issue for too long and will usually liquidate the shares in the market, often causing a financial loss.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
Devolvement — De*volve ment, n. The act or process of devolving;; devolution. [1913 Webster] … The Collaborative International Dictionary of English
devolvement — index assignment (transfer of ownership) Burton s Legal Thesaurus. William C. Burton. 2006 … Law dictionary
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devolvement — See devolve. * * * … Universalium
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