Glossary of Municipal Securities Terms


In a primary offering of municipal securities, the underwriting syndicate adopts the terms on which orders will be given priority. For competitive underwritings, orders received prior to the sale (“pre-sale orders”) generally are given top priority. In some negotiated offerings, retail orders or other restrictions designated by the issuer are given priority. Once the order period begins for either negotiated or competitive underwritings, the most common priority provision gives group net orders top priority, followed by net designated orders and member orders. These types of orders are described below:

Group Net Order An order at the initial offering price. A group net order benefits all syndicate members according to their percentage participation in the account.

Net Designated Order An order submitted by a syndicate member on behalf of a buyer on which all or a portion of the takedown is to be credited to certain members of the syndicate. The buyer directs the percentage of the total designation each member will receive in accordance with the terms of the underwriting syndicate.

Member Order – An order submitted by a syndicate member at the takedown price. Other priorities, such as retail orders or orders from local residents, may supersede those noted above. See: CONCESSION; LIST OFFERING PRICE OR TAKEDOWN TRANSACTION; ORDER PERIOD; PRE-SALE ORDER; SPREAD; SYNDICATE.

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