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    Question

    A technique that consists of staggering the maturity

    dates and the mix of different types of bonds is termed as?
    A Laddering Correct Answer Incorrect Answer
    B Fire Insurance Correct Answer Incorrect Answer
    C Escrow Account Correct Answer Incorrect Answer
    D Earned Premium Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Laddering is the promotion of inflated pre-IPO prices for the sake of obtaining a greater allotment of the offering. Laddering is an illegal IPO practice in which the underwriter engages in the sale of IPO shares to clients with the implicit agreement that more shares will be purchased post IPO, leading to big gains for both parties. Once the price increases a certain level, "insiders" then sell their shares and take their profits.

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