Lockup period
A lockup period is a stretch of time after a company goes public, usually 180 days, during which insiders agree not to sell their shares.
🌍 In the real world
Lockups are agreed with the underwriters rather than required by law. They stop founders and early investors dumping shares right after the IPO.
When a lockup ends, a wave of newly sellable shares can push the price down, so traders watch the date. Even after it, SEC Rule 144 limits how much an insider can sell at a time.
🎮 In Journey Shares
If someone claims their profile, the 100,000 shares held in escrow for them are locked for 180 days. After that they can sell only a small amount each day, so a claim can't flood the market. →
🧭 How to use it
Check the escrow line on a profile. A claimed person whose lockup is ending may start selling a little each day, a steady source of supply to keep in mind before buying big.
🎮 Learn Lockup period the fun way
Try it in a live 3D city with play money: trade shares in real public figures, get margin-called, pay your taxes and rob a bot or two. Free, and nothing real is at stake.
❓ Common questions
Do stocks fall when lockups end?
Studies of US IPOs have found prices tend to dip around lockup expiry, as the market expects insiders to sell.
Can insiders sell before the lockup ends?
Only if the underwriters agree to release them early, which sometimes happens.
📜 Where it came from
🔗 Related terms
- IPO (initial public offering): An IPO is the first time a company sells shares to the public, after which its stock trades on an exchange.
- Shares outstanding: Shares outstanding are all the shares of a company currently held by investors.
- Underwriter: An underwriter is the investment bank that manages a new stock or bond issue, pricing it and selling it to investors in return for a fee.
- Liquidity: Liquidity is how easily something can be bought or sold quickly without moving its price much.
Categories: Trading basics
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