In investing, an IPO stands for initial public offering. This is where a company first lists its stock on an exchange to become publicly listed. When a company becomes publicly listed, general members of the public can purchase its stock.

The ASX refers to Australia's largest stock exchange, the Australian Securities Exchange. An ASX IPO is where a company publicly lists its stock on the ASX so that it's accessible to members of the Australian public. Each year, dozens of companies list their stock on the ASX through an initial public offering (IPO).

How do IPOs work for employees?

Ahead of an IPO, a company may decide to offer stock to employees as part of their contract or bonus structure. Once the IPO is complete and stock is listed on an exchange, employees may then decide whether they want to purchase company stock directly themselves. Typically stock that is offered before the IPO will be at a discounted price to what is offered on the exchange, so owning pre-IPO stock may be beneficial to employees. However, the stock market can be volatile and stock prices may also fall substantially after listing on an exchange, driving the value of employee portfolios down.