Question: Which is true about VC or PE fund's post-IPO holdings in companies? VC and PE funds typically sell their shares immediately at the time of the IPO Distributing shares to LPs is a common practice VC and PE funds typically retain their holding for the long term after an IPO, transitioning to be long term invested in the newly public company The market tends to react negatively if/when the VC or PE fund sells its sharesose a firm lists on the market. It experiences a solid first day of trade. However, it underperforms the benchmark from the next day and over the next year. Which is a possible explanation of the apparent post-IPO underperformance? Market timing - the firm listed when the market was over-priced and the market subsequently corrected Earnings management or other accounting issues at the time of the IPO Irrational exuberance on the first day of trade, pushing the company's price above its true value Post-IPO changes in governance when investors and/or founders cash out All of the above