Aftermarket

The term aftermarket is related to volatility in the prices of the stock post its IPO. The details of the same are given here.

Aftermarket performance of an IPO is the measure of the performance of security after the closure of the IPO. The newly issued stock is seen to be quite volatile in the initial days after it is listed on the stock exchanges. There is no definite end period for measuring the aftermarket performance of a stock. However, analysing the same will let the analysts gauge the response of the investors post-listing and understand key parameters like initial earnings of the IPO, the interest of investors in the stock, and thereby the impact of the same on stock prices, etc. The company can generate an aftermarket performance report to understand the demand for the stock, liquidity of the stock, post-IPO valuation of the company, etc.