Flotation Cost
The costs associated with the issuance of new securities.
Investopedia Commentary
Flotation costs include both the underwriting spread and the costs incurred by the issuing company from the offering. Expressed as a portion of gross proceeds, costs generally increase as risks associated with the issue increase, or the size of the offering decreases.
Also known as floatation cost.
See also: IPO, Prospectus
flotation cost