|
Marketing of securities such as shares and
debentures of any company or even your own company can be a challenge.
It might be difficult to get the entire required amount subscribed by
the public. It entails you to be careful when selecting the strategy to
use to market the debentures and shares. Investors have different
considerations when it comes to investing their savings.As a marketer
you should be able to read their preferences and requirements and cater
them exactly the way they want them.
Here are the methods you
should apply when selling securities:
Through the Prospectus-This
is the commonly used technique. So, what is a prospectus before a go
into details? A prospectus is a notice, circular, advertisement or any
other document inviting offers from the public for the subscription of
shares and debentures. The prospectus will contain details about; the
amount to be issued, the rights pertaining to the various shares, the
properties purchased by the company, details of directors and managing
directors, the minimum amount of subscription to be received before the
company starts business and other essential details.
In this
method, you will invite the public to subscribe to the shares and
debentures. The interested public will be allotted specific number of
share and debentures.
Public Placement-It's an arrangement which
you make with the issuing house, brokers or underwriters who will agree
to purchase debentures and place them with their clients. In private
placement, money will be advanced by bulk buyers of securities. This
method is mainly used to market debentures. It's cost effective because
the amount of commissions and legal expense are low.
Sale through
Stock Exchange-You can involve the brokers who operate in the stock
exchange to market shares. If the shares are listed in the stock
exchange market, then the public confidence is gained. Stock exchange
widens the market. Sale to the Employees-You can sell the debentures and shares to the
interested employees of that company. The employees will be advantaged
since the interests and dividends earned from the shares and debentures
will supplement their primary income. Debentures and shares under this
method are usually sold at a concessional rate so that the employees are
motivated to buy them.
Sale to the Existing Shareholders-You can
use this method and its where by the sale of shares and debentures are
sold to the existing shareholders at a concessional rate. This method is
also known as privileged subscription as it gives first priority to the
existing shareholders to purchase additional shares and debentures.
Sale
of Securities to Customers-In this method, you will sell the shares and
securities to your customers. It's a less costly method to use and it
does not entail much speculations.
Sale through Managing
Brokers-If you use this method, you will be provided useful services.
Under this method, you will be advised in matters regarding to the terms
and time of issuing securities so as to avoid contradictions with other
important issues. You will also be advised on the stock exchange
listings. The managing brokers will prepare the prospectus for you.
Marketing
Through Underwriters-This method overcomes the limitations of direct
sale through intermediaries. In this method, there is an agreement
whereby underwriters undertakes to guarantee the whole or such part of
the issued shares as would not be taken up by the public, in return for
an agreed commission.The underwriters will then sell those shares and
debentures to the interested public .
There are different types
of underwriting and they are:
Standing behind the issue
underwriting.
Outright purchase underwriting.
Firm
underwriting.
Syndicated Underwriting.
|