What are new issues defined as in investment terminology?

In investment terminology, new issues refer specifically to initial public offerings (IPOs) of equity securities. An IPO occurs when a company offers its shares to the public for the first time, allowing it to raise capital from public investors. This process marks the transition of a private company into a publicly traded entity.

The definition highlights the unique characteristics of an IPO, distinguishing it from other forms of capital raising such as secondary offerings, which involve the sale of shares that have already been issued and are held by existing shareholders. Options related to bond offerings or commodities do not fit the definition of new issues as they pertain to different categories of investment instruments. Therefore, the identification of new issues as IPOs specifically targets the initial equity securities in the market, underscoring their significance in the fundraising landscape for companies.