Do your research before investing in IPO stocks to avoid getting in at the wrong time.
IPO (Initial Public Offering)
-The first time the stock is released to the public and is available for purchase
The Problem With IPOs:
-The stock market is based on future expected growth
-IPOs need time to set up
-Preferred shareholders typically sell their shares as soon as the IPO comes out, which causes the stock to go down
-Sometimes preferred shareholders are required to hold their shares for 60-90 days, the stock can decrease at this time instead of dropping initially.
-As time go on, more shareholders can sell their stock. You need to read the find print to find out when this happens.
-Let the charts set up, give them time and do not hurry
-Don’t jump into things too quickly, IPOs should be avoided initially
-Understand why you are buying the stock. Don’t just purchase it because it’s a company you use (e.g. Zynga or Groupon)
-A better time to get in is after the stock has decreased over a period of time and begins to go back up. You don’t need to get in right away.
Example:
-Facebook (FB)
-Everyone expected FB to go way up, but it went very low because preferred shareholders sold their shares right away
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Thanks , The way you shared knowledge is really appreciable.
How to invest?
i invested some ipo shares with skyway transport .what do you think of skyway have i done the right thing ..i am a novice tbh at the share market
the company gets no cash from the secondary market right? I still don't completely understand how a company gets cash from the ipo. They get cash from the underwriter…then they sell off the stock, what happens between the primary and secondary market?
What is this chart you kept saying and what is a reliable source to use for a company's growth? Many thanks!
Thanks for the video! Though why exactly is it that the secondary investors dump their shares? Couldn't they make more money investing long-term?
excellent Boss
@ryan based off his missed opportunity video and experience, I would base it off how high you believe you believe the price is going. If the profit margins are gone. Find a new play. However if there is still meat on the bone. And volume and the technicals are showing good signs go for it
Colmex, a broker in Europe was able to short TWTR. They also have great leverage! love the stock market so much opportunity.
Do you have a video that further explains why a company or investors dump those stocks quickly ?
I think you should read a paper by J.Ritter (1991), IPOs on average have large price appreciations (ca.15% in the US) on day 1 of trading. Furthermore, given that post IPO companies have been found by numerous academics to under-perform equivalent assets and benchmarks for up to 5 years following the IPO, I wouldn't recommend buying them unless you are lucky enough to get one at the offer price.
How do you evaluate the timing of the ipo
Thanks, do you know where to start investing? Like a website or so?
What if the line in the graph is very low and you buy and then the line goes up again? Should you do that?