Have you ever thought of applying for a “successful” company’s IPO and getting “huge” returns out of it? Just hold on before you press that “Apply” button. Ask yourself these 3 questions before investing in an IPO of any company:
1. Is the price justified? Will the price of its shares after listing will always be above the IPO price? Is it guaranteed? Can’t I get it at a much lower price in future? Will I get its shares in this lottery?
2. Why are the promoters selling their shares at high prices?
3. How much amount of profit (or loss) you would make on this issue? Does it makes sense for you to waste your time of about two weeks over this small gain (or loss)? What about your productivity loss over this period?
These answers can only be answered by yourself, not by Youtube experts. There are far many good companies to invest in, at all times, than to invest in an IPO.
For me, an IPO is a PR exercise to take money out of your pockets for a guaranteed, super hopeful future. IPOs are astrologers in their own way, aren’t they? Think. And most IPOs come out during bull time so to get maximum money from unthoughtful investors. There are many examples of big IPOs which are way down from their listing price. History is full of such examples.
Please leave your thoughts and questions in the comment section below.