What is the term for an investor's expression of interest in purchasing new issue securities after reviewing the preliminary prospectus?

The term for an investor's expression of interest in purchasing new issue securities after reviewing the preliminary prospectus is referred to as an "indication of interest." This term is commonly used in the underwriting process, where potential investors can signal their intention to buy shares before the security is officially offered. An indication of interest allows underwriters to gauge demand for the new securities, assisting in determining the final pricing and allocation of shares during the public offering.

This concept is critical as it helps both issuers and underwriters in planning the public offering effectively, ensuring that they can match supply with investor demand. It also reflects the investors' preliminary interest, but it does not constitute a binding commitment to purchase the securities, providing flexibility for both parties before the final sale. Understanding this terminology is essential in the context of the securities market and offers insights into how initial public offerings (IPOs) are administered.