Dutch Auction

Dutch Auction - The Dutch auction which got its name from the famous auction back in the 17^th century of Dutch Tulip bulbs, is a descending auction. Instead of the traditional negotiating process to set Initial Price offering (IPO) the Dutch auction uses a descending bidding process to set the highest price the issuing company can sell its remaining shares. The United States Treasury initializes the Dutch auction to sell its stock. William Vickrey ( noble prize winning economist) devised this pricing system. This is also known as a "clock auction" or an open-outcry descending-price auction The biding decends till someone accepts the bid, and that's the determined price for the stock.