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Started By
Message
re: SNAP INC
Posted on 3/2/17 at 12:21 pm to TheIndulger
Posted on 3/2/17 at 12:21 pm to TheIndulger
quote:
So could I have gotten in at $17 today, by putting in an order to buy before trading started?
No.
The shares are allocated ahead of time. It's how they set the offer price. They go on whats called a "roadshow" and the investment bank that is in charge of the IPO basically goes on a whirlwind tour pimping their client and trying to get the highest price available. This is the offer price, this is the money the company actually gets. There is a finite amount of shares and they are allocated to various investment companies, most go to institutional investors and other high profile clients. Joe Schmo has no chance on a hot IPO like SNAP. Even Joe millionaire is probably hosed.
So the IB wants it to be just right. Too low and if the stock pops on opening day then the client is pissed because they left too much money on the table. Too high and the stock goes down on opening day and can cause a lot of angry investors and bad press.
3
Posted on 3/2/17 at 12:31 pm to barry
That makes sense. Thanks.
Posted on 3/2/17 at 12:32 pm to barry
quote:
barry
I appreciate all of your work on this board
Posted on 3/2/17 at 3:37 pm to barry
quote:
barry
That's the most concise and easy description of an first day of an IPO I've ever read. Good work.
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