Indication of Interest

Definition - What does Indication of Interest mean?

Indication of Interest is an investor’s expression of a willingness to purchase a new issue of securities after receiving a preliminary prospectus. The investor’s indication of interest is not binding on either the investor or the firm.

Testopedia explains Indication of Interest

When a new issue of securities is being offered for sale the underwriters may gather indications of interest from investors during the cooling off period. A registered representative may send an investor a preliminary prospectus to determine if the investor may be interested in purchasing the securities. An official offer for the new issue may only be made by sending the investor the final prospectus.

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