Quiet period

The quiet period is a window of time around a company's IPO during which the company, its executives, and its underwriters are restricted from making promotional statements or forecasts about the business that could hype the stock ahead of the offering. It applies both before the company files its registration statement and for a period after the IPO is completed.

The idea behind the restriction is that investors should be making decisions based on the information in the company's official prospectus, which goes through SEC review, rather than on interviews, press releases, or other promotional commentary that has not gone through that same disclosure process. A company caught violating the quiet period risks having its offering delayed or facing SEC scrutiny.

The quiet period also affects analysts at the underwriting banks involved in the deal, who are typically barred from publishing research coverage on the newly public company for a set period after the IPO. This is why a wave of analyst coverage and price targets often appears on a stock all at once once that restriction lifts, sometimes causing a noticeable jump in trading volume or price movement around that date.