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Companies participate in stock exchanges to raise money from an IPO or initial public offering. An IPO is when they divide a portion of the company up into shares and then sell those shares to a select group of individuals, mostly brokers, underwriters and people who have had some role in issuing the stock. The purpose of going public with a company is to raise capital to reinvest back into the company in hopes that after the IPO demand for the stock of the company will continue to increase thereby bringing the price of the stock up and increasing the return on investments of those who own the company and those who hold the publicly issued stock.

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15y ago

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