Allotment letter

Allotment letter,

Definition of Allotment letter:

  1. Document that details and confirms the amount or number of securities allotted to an applicant for a new issue or a rights issue. Presented usually as a certificate, it is renounceable up to a stated date. The allottee stockholder (shareholder) may renounce it in favor of another stockholder, or may sell his or her rights. If accepted by the allottee, it becomes the evidence of title to the stockholding. Also called letter of allotment, it may be traded on a stock exchange like the security it represents.

  2. (Originally) a contractual letter confirming an application for shares in a company has been successful; (now) a temporary certificate of share ownership, in receipt of payment for shares allocated from a new issue.

Meaning of Allotment letter & Allotment letter Definition