Wealthsimple IPO Policies

Overview

An initial public offering (IPO) is the first time a company sells its shares to the public on a stock exchange. IPO access through Wealthsimple lets you request shares of select companies seeking to go public on Canadian and U.S. stock exchanges at the IPO price, before the stock starts trading on the open market.

Participating in an IPO means you can request shares at the offering price, the same price institutional investors pay before the stock starts trading publicly.

We're not the underwriter. Investment banks running the IPO invite us to participate as a selling group member, and we pass that opportunity on to eligible Wealthsimple clients.

Note: Not every IPO is available on Wealthsimple. We can only offer the deals we're invited to participate in. We’re working hard to get our clients access to as many deals as we can. 

Who can participate

To request an allocation of IPO shares, you need to:

• Be a Wealthsimple client with an eligible investing account in good standing

• Have enough cash in your account to cover the shares you're requesting

• Confirm you're not a restricted person, which is someone affiliated with the financial services industry restricted from participating in IPOs, insiders or employees of the issuer, or restricted Wealthsimple employees

Note: Make sure you have enough cash in your account to cover your request. If you're transferring funds in, allow a few business days for the deposit to settle before the request deadline.

Eligibility for specific deals depends on where the IPO is taking place:

• Canadian IPOs: Open to all Wealthsimple clients in Canada

• U.S. IPOs: If the U.S. IPO is marketed into Canada by way of a prospectus, it is open to all Wealthsimple clients in Canada. If the U.S. IPO is a U.S. only offering, securities laws require us to only make these IPOs available to higher net worth clients who qualify as accredited investors under Canadian securities law. If you buy as an accredited investor in a U.S. IPO, you'll be asked to complete a short eligibility questionnaire and sign a risk acknowledgement

For more information on IPO access at Wealthsimple, and to help determine if you are eligible to request an allocation in an IPO, please consult our Frequently Asked Questions (FAQs) below. 

How to request shares

When an IPO is open for requests, you'll see it in the Upcoming IPOs section of the Wealthsimple app or website. Here's how it works.

Step 1 — Review the deal

Each IPO has a listing page with:

• The issuer's offering documentation

• Expected price range and number of shares being offered

• Expected pricing date and listing exchange

Read the offering documentation carefully before deciding to participate. It contains the information you need to make an informed decision, including the company's business, financials, management, and risk factors.

Step 2 — Place a conditional offer to buy

A conditional offer to buy (COB) tells us how many shares you'd like at the IPO price. To place one:

1. Open the IPO listing page

2. Tap Request shares

3. Enter the number of shares you'd like

4. Choose which account to use

5. Review and confirm

We'll set aside the cash needed to cover your request, plus a 20% cash buffer, so you don’t accidentally spend it on something else. The funds set aside stay in your account and won’t be used to pay for the shares until the allocation process is complete and the cancellation window closes, as described below. If you’re transferring funds in, allow a few business days for the deposit to settle before the request deadline.

We'll give you advance notice before we close our order book. Once the book closes, no new requests can be placed, but you can still cancel an existing request right up until the cancellation window closes at midnight the night before closing of the IPO.

Note: A conditional offer to buy is not a guarantee that you'll receive shares. Demand for IPOs typically exceeds supply, and you may be allocated all, some, or none of the shares you requested. Client COBs are first selected through a randomized process, and then the size of the request factors into how many shares are then allocated. 

Step 3 — Pricing

Before the IPO closes, the underwriters set the final price. We'll check it against the price range originally disclosed to you in the IPO listing page:

• If the final IPO price is within the 20% buffer of what was previously disclosed, your request stays in place automatically.

• If the final IPO price exceeds the 20% buffer (i.e., it comes in higher than your reserved cash can cover), your bid quantity will be automatically adjusted down to match your reserved cash. 

Either way, we'll notify you as soon as pricing is finalized, and you'll have until midnight that same night to cancel your request if you no longer want to proceed at the final price. You won't know how many shares you've actually been allocated until the next morning, after the cancellation window has already closed. In other words, your decision to cancel is based on the price, not the allocation. If you cancel, you won’t receive any shares and the cash we held against your request is released back to your available balance. 

Once the cancellation window closes, your conditional offer to buy becomes a binding purchase order. You can no longer cancel or change it.

Note: Pricing timing depends on where the IPO is happening. Canadian IPOs are typically priced 5–10 days before the IPO closes, while U.S. IPOs are priced the night before closing. Either way, we'll notify you when pricing happens and let you know whether any action is required.

Step 4 — Find out what you received

We'll let you know your allocation in the app and by email, generally on the morning of the IPO date and before the stock starts trading on the open market.

You can review your allocation in the Activity section of your account. Any cash that was held against your request but not used will be released back to your available balance.

Frequently Asked Questions (FAQs)

For more information on IPO access at Wealthsimple, please consult our Frequently Asked Questions (FAQs) below. 

Getting Started

What's an IPO?

An initial public offering (IPO) is the first time a company sells its shares to the public on a stock exchange. IPO access through Wealthsimple lets you request shares of select seeking to go public on Canadian and U.S. stock exchanges at the IPO price, before the stock starts trading on the open market. 

Participating in an IPO means you can request shares at the offering price, the same price institutional investors pay before the stock starts trading publicly.

We’re not the underwriter. Investment banks running the IPO invite us to participate as a selling group member, and we pass that opportunity on to eligible Wealthsimple clients.

Note: Not every IPO is available on Wealthsimple. We can only offer the deals we’re invited to participate in. We’re working hard to get our clients access to as many deals as we can. 

What’s IPO Access through Wealthsimple?

IPO access through Wealthsimple lets eligible clients request shares in select upcoming IPOs at the offering price, right from the Wealthsimple app. Access to IPOs has historically been reserved for institutional and high-net-worth investors. We’re working to change that.

How’s requesting IPO shares different from buying a regular stock?

When you request shares in an IPO, you’re asking to purchase them at the offering price set by the company and its underwriters before the stock starts trading. Until the IPO is priced and closed, you’re making a request, not a purchase. And there is no guarantee that you will receive the amount of shares you’re looking to purchase, or any at all. You can cancel it at any time before the request becomes final.

Once trading begins, the price can move up or down based on demand. There’s no guarantee the price will go up (or stay up) once trading starts.

Does it cost anything to participate?

No. There are no fees to request shares or receive an allocation. You only pay for the shares you’re allocated, at the final offering price. Please note that Wealthsimple has a policy on “flipping” which is discussed below. 

Are there any applicable taxes?

Standard tax rules apply to any gains or losses on IPO shares. If you sell at a profit, the gain is generally a capital gain; if you sell at a loss, it’s generally a capital loss. The tax treatment depends on the account you hold the shares in. Talk to a tax professional if you're unsure how an IPO might affect your tax situation.

Who Can Participate

Who’s eligible for IPO Access?

To request an allocation of IPO shares, you need to:

• Be a Wealthsimple client with an eligible investing account in good standing

• Have enough cash in your account to cover the shares you're requesting

• Confirm you're not a restricted person, which is someone affiliated with the financial services industry restricted from participating in IPOs, insiders or employees of the issuer, or restricted Wealthsimple employees

Note: Make sure you have enough cash in your account to cover your request. If you're transferring funds in, allow a few business days for the deposit to settle before the request deadline.

Eligibility for specific deals depends on where the IPO is taking place:

• Canadian IPOs: Open to all Wealthsimple clients in Canada

• U.S. IPOs: If the U.S. IPO is marketed into Canada by way of a prospectus, it is open to all Wealthsimple clients in Canada. If the U.S. IPO is a U.S.-only offering, securities laws require us to only make these IPOs available to higher net worth clients who qualify as accredited investors under Canadian securities law. If you buy as an accredited investor in a U.S. IPO, you’ll be asked to complete a short eligibility questionnaire and sign a risk acknowledgement

How do I sign up for IPO Access?

You'll complete a short IPO enrollment flow in the app. It covers:

• Confirming you’re not a restricted person

• Agreeing to our no-flipping policy

• Acknowledging the risks of IPO investing

• Consenting to receive offering documents electronically

Restricted persons

Most Wealthsimple clients can participate in IPOs through our platform. Some people, however, are either prohibited or subject to additional conditions. These people include certain individuals that are affiliated with the financial services industry that are restricted from participating in IPOs, insiders and employees of the issuer, and certain Wealthsimple personnel involved in the deal. If you work in financial services (at Wealthsimple or elsewhere), you’re not automatically excluded, but additional conditions may apply.

You’ll be asked to attest to your status before your first IPO request, and to confirm it for each subsequent deal you may seek to participate in. If your status changes after you receive an allocation, please update your information promptly. Providing false information may result in cancellation of your allocation, disgorgement of profits, loss of access to other upcoming IPOs, and reporting to regulators.

What’s an Accredited Investor?

For certain U.S. IPOs, you may only participate if you are an Accredited Investor. An Accredited Investor is someone who meets specific financial thresholds under securities law. You may qualify if:

• You (alone or with a spouse) own financial assets worth more than $1,000,000, net of liabilities and before taxes

• You (alone or with a spouse) have net assets of at least $5,000,000

• Your income before taxes was over $200,000 in each of the last two years (or $300,000 combined with a spouse), and you expect to hit that again this year

• You own financial assets worth more than $5,000,000, net of liabilities and before taxes

How do I know if I qualify as an Accredited Investor?

If your qualifying assets are held at Wealthsimple, we can confirm your status automatically. If they're held elsewhere or if you're qualifying based on income, you'll self-certify during IPO enrollment, and again when you submit a bid for a U.S. IPO.

Can I lose my Accredited Investor status?

Yes. If your qualifying assets fall below the threshold, say, because you moved money out of Wealthsimple, you may no longer qualify for U.S. IPOs. We'll ask you to reconfirm your status each time you submit a bid for U.S. IPOs.

Requesting Shares

How do I request shares in an IPO?

When an IPO becomes available to our clients, you'll see it featured in the IPO center on Wealthsimple web. From the Upcoming IPO page, enter the number of shares you’d like, and we’ll take care of the rest.

You don’t need to set a price. Your request is placed within the expected price range set by the issuer.

For a detailed overview, see our IPO Access page under “How to Request Shares” for a step by step overview of the process to request IPO shares.

Why “request” and not “buy”? 

Until the company files its final prospectus, prices and allocations aren’t locked in. What you’re submitting is a Conditional Offer to Buy, a request to purchase shares if the IPO goes ahead at a price you’re comfortable with. It becomes final only after the IPO is priced and your allocation is confirmed.

How much cash do I need?

When you submit a request, we’ll reserve cash in your account based on the top of the expected price range, plus a 20% cash buffer to account for any upward price movement. The reserved amount is the maximum you'll pay: if the final price exceeds the buffer, we'll adjust your bid quantity down to match your reserved cash rather than ask you for more. If the final price comes in lower, or if you aren’t allocated the full amount of your requested shares, we release the extra cash back to you.

This reserve is held while your request is active. We’ll explain exactly how much is being reserved, and why, before you confirm your request.

Note: Make sure you have enough cash in your account to cover your request. If you're transferring funds in, allow a few business days for the deposit to settle before the request deadline.

Can I submit more than one request for the same IPO? 

No. You can have one open request per IPO across all your Wealthsimple accounts. If you hold more than one account, you’ll need to choose a single account to place your request from.

How long do I have to place a request?

Each IPO has its own request window. The exact deadline is shown on the IPO’s page. All timing displayed, including expected pricing and listing dates, is based on information in the official offering documents and may change.

Can I cancel or change my request?

Yes. You can cancel your request anytime before it becomes final at the end of the cancellation window, directly from the IPO’s page or your activity feed. 

We’ll send you a notification before your request becomes final, giving you a clear last chance to cancel. Note that your last chance to cancel comes after we share the final price, but before we confirm your allocation. You'll be deciding based on the price, not the number of shares you'll receive.

Is my bid guaranteed?

No. Submitting a bid isn’t a guarantee that you’ll receive shares. IPOs are typically in high demand, and allocations are often partial or nothing at all.

How are shares allocated?

There's no minimum amount required to participate. Request the number of shares you'd like, and we'll do the rest.

Given the limited supply of IPO shares, IPO demand usually exceeds what's available. We allocate shares in two steps:

• Random Selection: First, we run a randomized selection process across all eligible requests to determine who receives an allocation. Every request has the same chance of being selected, regardless of its size or your account history with Wealthsimple. We do not favour wealthier clients or clients with larger orders in this step.

• Allocation Sizing: The number of shares you request then factors into how many shares you actually get, but it doesn't affect the likelihood that you'll get any allocation. Your allocation will not exceed your final bid quantity (which may be lower than what you originally requested if the final IPO price exceeds your reserved cash buffer).

Note: Requesting shares isn't a guarantee that you'll receive them. Most IPOs receive far more demand than the underwriters allocate to us, so many clients receive fewer shares than they asked for, or none at all.

Our no-flipping policy

What's the no-flipping policy?

Selling (or transferring your shares off the Wealthsimple platform) your IPO shares within 90 days of the IPO is known as flipping. Underwriters discourage flipping and may exclude us from future IPOs if we permit it. If you flip your IPO shares, you may be restricted from participating in upcoming IPOs on the Wealthsimple platform in the future. 

Our current policy for clients that flip their shares is to prevent them from participating in any future IPOs on our platform.

Why does this matter?

Underwriters allocate IPO shares to brokerages they trust to place them with long-term investors. If our clients flip shares on day one, we lose credibility and future allocations. Our no-flipping policy helps ensure we can keep bringing IPO access to clients over time.

What happens if I flip my shares?

Clients who flip IPO shares may lose access to future IPOs on Wealthsimple. Our current policy for clients that flip their shares is to prevent them from participating in any future IPOs on our platform. 

Pricing & Timing

How is the final price set?

The issuer and its underwriters set the final price based on investor demand and market conditions. It usually lands within the expected price range shown in the offering documents, but not always. All dates and pricing shown in the app before final filing are expectations, not guarantees.

What if the final price is lower than what was reserved?

Any extra cash we reserved comes back to your account.

What if the final price is higher than the price range?

If the final price comes in higher than your reserved cash can cover (i.e., it exceeds the 20% buffer), your bid quantity will be automatically adjusted down to match your reserved cash. We'll notify you as soon as pricing is finalized, and you'll have until midnight that same night to cancel if you don't want to proceed at the revised quantity. If you cancel, you won't receive any shares and the cash we held against your request is released back to your available balance.

Note that you'll know the revised price before the cancellation window closes, but you won't know your allocation until the next morning.

When will I find out how many shares I got?

You'll be notified once the IPO has been priced and allocations are confirmed before the stock starts trading. You can see your allocation in the app, and any unused cash will be returned to your account.

After the IPO

When can I sell my shares?

You can sell your IPO shares whenever you’d like once the stock starts trading on the secondary market. There’s no formal lock-up that applies to IPO shares held by our clients. Please note that Wealthsimple has a policy on “flipping”, which is discussed above. Please be aware, our current policy for clients that flip their shares is to prevent them from participating in any future IPOs on our platform. 

Note: The stock often doesn’t start trading right at market open. Underwriters need to finalize allocations first. It’s common for IPO trading to begin later in the day on the listing day.

What if I don’t get any shares? Can I still buy on the open market?

Yes. Once the stock is trading, you can buy it on Wealthsimple like any other stock, at the market price. The no-flipping policy applies only to shares received through IPO Access.

Offering documents & notifications

What documents will I receive?

As part of IPO enrollment, you’ll consent to receive offering documents electronically. For each IPO you’ve requested shares in, we’ll deliver:

• The preliminary prospectus (or registration statement)

• The final prospectus (or registration statement)

• Any amendments made to the preliminary or final prospectus (or registration statement)

Documents are emailed to you and posted both to the IPO’s page in the app and to the Documents section of your account. We keep a record of exactly what was delivered and when.

What notifications will I get?

As Wealthsimple is not an underwriter, it is limited in the information it may receive ahead of time. Once you’ve requested shares in an IPO, we’ll give notices as soon as we can for the following items:

• A new document is delivered for that IPO

• The expected pricing or listing date changes

• The timing for the closing of our order book

• The IPO has been priced and your allocation is confirmed

• Your request is about to become final (your last chance to cancel)

• Your allocation has been confirmed 

• The IPO has closed

You can manage notification preferences in your account settings.

Can I get notified about new upcoming IPOs?

Yes. You can opt in to receive notifications when new IPOs become available for request on Wealthsimple.

Withdrawal rights (IPOs offered into Canada)

Can I change my mind after the final prospectus is filed?

For IPOs offered into Canada (Canadian IPOs and U.S. IPOs offered in Canada by way of a prospectus), yes. You have a 2 business day window to withdraw after the later of when the final prospectus (or any amendment) is delivered to you or the time your Conditional Offer to Buy becomes binding. During that window, you can cancel your order and get your reserved cash back.

To exercise your withdrawal right, please contact us at wealthsimple.com/en-ca/contact.

Note: Unlike U.S. IPOs, the closing for Canadian IPOs occurs 5-10 days after the final prospectus has been filed and once your allocation has been determined. 

What if the prospectus is amended?

The 2 business day clock resets, giving you another chance to review the updated terms and cancel if you want to.

Risks to know about

Is investing in an IPO risky?

Yes. IPOs carry real risks. Please review our IPO Risk Disclosure page for more information on IPO-related risks. These risks include:

• Price volatility: Newly listed shares can move sharply in the first days, weeks, and months of trading. The opening price on the secondary market can be very different from the IPO price

• Limited track record: Many companies going public have shorter histories than established public companies. Many companies going public are early-stage and may not be profitable. The risks described in the offering documents are real and material, you should always consult the offering documents and read the risk section carefully

• No guaranteed return: The share price could fall below the offering price after listing

• Uncertain allocation: You might get fewer shares than you requested, or none at all

• Reduced public information: During the quiet period (which generally ends 25 days after the IPO), the issuer is restricted from making public statements outside the offering documents. We'll limit news on the company's stock detail page during this time

Please read the offering documents carefully, including, in particular, the risk factor section, and think about whether an IPO fits your goals and risk tolerance.

What happens if I'm not truthful about my Accredited Investor status?

Providing false or misleading information when confirming your eligibility or Accredited Investor status may be a violation of securities laws. In addition to any regulatory penalties or fines, if we determine that you’ve provided inaccurate information, we may cancel your bid, reverse any allocation you’ve received, and restrict your access to future IPOs. Please make sure your answers are honest and accurate.

Where do I find the prospectus?

A link to the official prospectus is on each upcoming IPO’s page in the Wealthsimple app, in the Documents panel. Final documents are also emailed to clients who receive an allocation and posted to the Documents section of your account.

Canadian IPOs vs. U.S.-Only IPOs

What are the differences between Canadian and U.S. IPOs?

There are a few differences worth knowing. 

Policies Subject to Change

The information on this page, including our IPO Access policies, processes, eligibility criteria, allocation methodology, no-flipping policy, and notification practices, is current as of the date of last update and is subject to change at any time without notice. Wealthsimple may modify, supplement, or replace any of these policies at its sole discretion, including in response to evolving regulatory requirements, underwriter terms, market practice, or operational considerations.

You should review this page each time before submitting a Conditional Offer to Buy in an IPO to make sure you understand the policies and procedures that will apply to your bid.

The terms specific to any particular IPO, including pricing, timing, eligibility, and withdrawal rights, are governed by the offering documents for that IPO and the disclosures provided to you on the applicable IPO listing page.

This page is for informational purposes only and isn't investment, tax, or legal advice. Access to IPO shares is offered by Wealthsimple Investments Inc. IPO shares are subject to risks described in the issuer's offering document and our IPO Risk Disclosures.