Yes, you can take a short (sell) position if you believe the company’s share price will fall below our pre-IPO price once the company lists.

Pre-IPO markets can move quickly and may be volatile. It's important to note that there is a risk the IPO opens at a price significantly different from the pre-IPO level. This is known as 'gap risk' and is an inherent feature of pre-IPO trading. The divergence can occur because pre-IPO pricing is based on expectations, while the listing price is determined by the actual IPO process and early exchange trading. When you trade with leverage, your potential profits and losses are magnified based on the full value of the trade. However, as a retail client, you can't lose more than your account value, due to negative balance protection. If your margin level is insufficient to maintain your position, it may be automatically closed out. Learn more about managing your risk

Pre-IPO trading | CMC Markets

Q: What is pre-IPO trading?

Pre-IPO trading, also known as grey market trading, allows you to take a position on a company’s potential share price ahead of its initial public offering (IPO). Unlike investing through an IPO application, you're not buying or applying for shares. You're place a spread bet or contracts for difference (CFD) position based on a synthetic price which reflects market expectations of a potential IPO valuation. The pre-IPO price can move significantly as new public information and market sentiment evolve. Your trade rolls into the listed share spread bet/CFD once the company lists. The position remains open and you retain control over how long you wish to keep it open, and when to close it.

Q: When can I trade on a pre-IPO market?

You can trade once the pre-IPO market is open, usually from when an IPO is announced up until the company lists.

Q: How is my trade settled?

When the company successfully lists, your pre-IPO spread bet or CFD transitions seamlessly into a standard spread bet/CFD on the listed share. The instrument then references exchange-based pricing and normal trading conditions apply. There is no forced settlement or manual intervention required – the position continues under the same listing. Your position remains open and you retain control over when to close it.

Q: What if the IPO is cancelled?

If the IPO is cancelled, or the company says it will not go ahead, open positions will be cancelled at the original execution price, so no profit or loss is realised. Any positions that were closed before the cancellation won't be reversed, and so will remain binding.

Q: Where can I see upcoming pre-IPO markets?

Upcoming pre-IPO markets will appear in the product library under shares in our platform when available.

Q: Can I close my position before the IPO?

Yes. You can close your position during our normal trading hours at any time from when the pre-IPO instrument is made available on our platform until it transitions to the listed share spread bet or CFD at IPO.

Q: How does CMC determine the pre-IPO price?

The pre-IPO instrument provides synthetic exposure to the expected share price of a company before it lists on a stock exchange. Before listing, prices are based on our assessment of the company’s expected list price, drawing on publicly available information such as: The indicative IPO price range, where available Valuations of comparable listed companies Market conditions and sentiment Prices are not based on private secondary market transactions and may differ significantly from private market valuations. There is no active underlying market on a company’s shares before it lists, which means there is no exchange-traded reference price that we can use before the IPO. This may have the following implications: Prices may be volatile Spreads may be wider than for other share CFDs The product cannot be hedged in the open market The IPO may open at a price materially different from the pre-IPO price, potentially exposing you to gap risk and potentially significant losses

Q: How often is the price updated before the IPO?

Price updates vary by company and depend on how close the IPO date is. As more information becomes publicly available, including updates to the expected price range or demand for the shares, prices may be updated more frequently. Updates may be irregular and pricing may change quickly.

0.0

Pips FX minimum spread¹

1:200

Maximum retail leverage

0.01

Micro lot trading*

12,000

Financial instruments

24/5

Dedicated customer support

*Trade one-hundredth the size of a standard lot

How it works

With our pre-IPO market, you can take a position on a company before its IPO, based on what you think its share price will be when it lists.

Example: ABC Company is expected to list at 500p.

If you think the list price will be higher, you would go long (buy)
If you think the list price will be lower, you would go short (sell)

Once the shares start trading, your position rolls over into a regular share spread bet or contract for difference (CFD), giving you control over whether you close the trade or keep it open.

Leveraged trading products, such as spread bets and CFDs magnify profits and losses equally, so it’s important to manage risk carefully.

If the IPO is cancelled or doesn’t happen for any reason, your open trades will be closed at the price at which they were opened, and no profit or loss will be realised.

Which companies are available to trade pre-IPO?

When a company announces plans to go public, we may open a pre-IPO market, based on our view of what the shares could be worth. When the company goes public and lists, your pre-IPO spread bet or CFD position rolls into the listed share spread bet/CFD. This means your position continues and you retain full control over when to close it.

Companies that could announce IPO plans in the future include Revolut and OpenAI. Follow the links below to learn more about potential IPO stocks.

Fintech

Revolut

Expected listing: TBD

Technology- AI

OpenAI

Expected listing: TBD

Pre-IPO trading: a step-by-step guide

Interested in trading on our pre-IPO markets? Here’s how it works:

1. Find the market

In the platform, go to ‘Products’ and then 'Shares' and search by company name.

2. Choose your direction

Buy (go long) if you think the price will rise above the quoted level after its IPO, or sell (go short) if you think it will move lower.

3. Set the trade size and risk controls

Choose your stake and consider a stop-loss to manage risk. Check margin requirements before placing the trade.

4. Decide when to close

Your position rolls into the listed share spread bet/CFD once the company lists. You retain control over when to close it.

Why trade with us?

Trade on the go

Track your trades at home or on the move with our web platform, iOS and Android app.

Go long or short

Go long or short on shares before they go public.

Trade with leverage

Leverage amplifies potential profits and losses equally, so manage risk carefully.

FAQs

What is pre-IPO trading?

When can I trade on a pre-IPO market?

How is my trade settled?

What if the IPO is cancelled?

Can I go short?

What are the risks?

Where can I see upcoming pre-IPO markets?

Can I close my position before the IPO?

How does CMC determine the pre-IPO price?

How often is the price updated before the IPO?

Can I close my pre-IPO position at any time during the first day of trading?