lock-up period

Definition

A contractual restriction preventing insiders from selling shares after an IPO, typically 90-180 days. Because letting founders dump all their stock on day one would be honest but catastrophic for stock price.

Example Usage

My lock-up period ends in 90 days, and I've already planned which private island to buy with my paper gains.

Origin

Securities law and IPO underwriting standards, formalized in modern form in 1980s-90s

Fun Fact

Lock-up expirations often trigger stock price drops as insiders finally sell, a phenomenon so predictable that hedge funds trade around it.

Source: IPO and securities regulation terminology

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