Today we’re going to take a look at investing in IPOs or initial profit offerings.
Investing in IPOs is something that people are often attracted to because they think that company could be the next Google, it could be the next Facebook or the next Microsoft, and as those companies increase their value in the future, you’re able to make money from your investment.
Let’s take a look at some IPOs and I’ll share with you my own personal insights and wisdom about trading or investing in IPOs and maybe it’ll give you another perspective, and then you can make your own decisions.
IPO basics.
An IPO is an initial public offering. Which means you get to purchase a stock early on, when that company is new to the public market. Basically, you can’t buy a piece of a company if it’s a private company, but if it’s an IPO or public, you can get a little piece of that company before it gets to stage 10 as far as profitability goes.
If the company is just starting, then you’re able to get it at level 1 or 2, other than waiting until it’s already a mature company, allowing you to capitalize on that growth from the beginning.
Companies do an IPO in order to raise money, rather than getting a loan from a bank and having to pay the bank an interest rate. Instead what they do is get money from investors by doing an IPO. And then they can use that money to grow their business.
What’s the big problem with most IPOs?
Most IPOs are horrible investments. The problem is that when a company is just starting and it begins to grow, things start to change, and the company needs to figure things out.
When a company does an IPO, there are a lot of new tasks that need to be done, there are a lot of new headaches that come, and it needs to figure those things out, and it’s kind of like a deer trying to stand up for the first time. The company is just trying to find its footing because it’s going to that next stage and level. So the growth of the company is on shaky ground. That’s why you need to be careful when investing in IPOs.
Usually, the enthusiasm pushes those stocks initially, sometimes to extreme valuations and higher prices, and if you’re able to get in at the right time and get profits at the right time, you can definitely capitalize and make a great deal of money if your timing is correct. But that doesn’t happen to every IPO or every single company.
If the IPO is really good, if it’s a strong company, you don’t need to get in it the first day, week, month or even the first year. It takes one to two years for companies to digest things and start moving up. So there’s no need to rush into IPOs.
In this video, we’re going to take a look at some recent IPOs and evaluate how they’ve done in the past, and how you should be looking at investing in an IPO.
Posted at: http://tradersfly.com/2017/10/investing-ipo/
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I need to your help..
Good video. Clear, relevant, Informative.
Makes me want to invest and trade even more but don’t know how or where to start. Great and informal content.!
Thoughts on Chewy IPO?
when I see an IPO myself. They show to the public on the day around 12pm and not opening at the 8am time. why is that?
Really good eye opener. Try to educate myself in ipos. Do what's your point? Don't invest in tech companies ? Stay with real companies ?
In my opinion I don't believe in this type of investment since you never know what's going on, it is just like gambling.
Here you mostly talked about well known companies which were overhyped…
Really awesome video! Thanks
Thanks man! I love your info
Thank you for the reality check, the weed craze today says buy stocks/ iPo etc but the logic is sound advice, there is time to observe.
Great video man!!!!
Damn he shouldn’t have used twilio as an example (as of March 2019 that is)
many nuggets of wisdom in this vid.
Amazing video! Thank you for sharing your knowledge with us 🙂
Great info, thanks man. When Airbnb, Uber and lyft goes public I planned to buy what I can so I don't miss out. But this put things into perspective. I'll chill for at least the first 9 to 12 months before I consider buying.
What Do You Think Of HIGHTTIMES IPO>>???
CAN YOU TELL US MORE ABOUT PUTS AND CALL.
Thank you Sasha for your educational facts
You made a SOLID case to swing IPOs!!!! I understand the cynicism when investing long term, but to sway traders based on your examples seems a disservice.
This was a great video! Thanks ?
bro your video really taught me a lot, thank you.
So that means ipo helps early investor dump their loss/profit to small investors
Thank you for sharing . What software do you use to compare stocks
How do you think dji will do as an ipo?
Surely not every stock goes to the moon but the ones that do in a short amount time, surely they would be good to short?
Gopro is a bad example. Their sales declined dramatically and that is why their stock went down. They were doing great at first and that is why their stock skyrocketed. IPOs are risky and should be traded carefully. Buy it make few bucks and sell it
You released this at literally the best time. There's a certain company that I've been highly thinking about investing in, and this video gives me all the info I need. Thank you.
Another Great Video
You are the Best In Explaining things Thank you so much for all your Teachings Your Courses are Awsome!
Hello sasha, i have read two of your books so far and have learned a lot as a beginner. My question for you today is what is the difference between trading U.S and Canadian stocks? I know some brokers only do canadian stocks and some do both. The only difference i know is the value of the dollars. Im from Canada, so when i begin trading does that mean i should be limited only to canadian stocks? Thank you for your time and If you have any content regarding this, please let me know.
Thanks again for this lesson.
Do you also use Japanese candle stick patterns in your analysis? I mean basic patterns like 'engulfing pattern' or 'Morning Star Pattern'? If yes, would you care to elaborate on how you use them? What is you take on them in general? They seem to give me some additional conformation.
you just saved me a lot of money
Is it weird that I want to start marketing and I started saving up to buy a broker or a platform but I still help so if you see this please contact me on Instagram @daniel_linton_29
thanks for the video. a have a question. if I want to short sale a stock what is the fee that I pay ?
I remember SNAP, I think I bought it at $24 day 1, all the insiders got in for around $17 before anyone else. I sold it at around $27 because I new it was junk.
Sasha, thank you, thank you! I've been considering recent IPOs $RYTM $SWCH, your insight in this video is much appreciated… It's hard to stay away from the "hype", because when you wait your entry is at a higher price.
Trading IPOs is very profitable.. short term.. we are traders we don't hold for years! If you get in on IPO day then more often than not (especially recently ) the forst couple of days to weeks will be extremely hot and profitable.. look at ROKU day1 and RYTM today as examples
Do you think that when CarGurus does their IPO on the 12th, they will do good?
SNAP is a public fire sale.