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2006-07-29 10:30:31 · 4 answers · asked by J T 6 in Business & Finance Investing

4 answers

Here is just an observation from my time working in the IPO department of Charles Schwab. We had a formula for figuring out who would get shares based upon how long they had been a customer, how much revenue they generated, whether or not they had received IPO shares in the past, and how much assets they maintained with the company. For the "hot" IPO's that any fool could tell would take off, it was very difficult to be allocated any shares unless you were a true gold star customer. For the unknown quantity IPO's or the complete dogs it was much easier to be allocated shares. Obviously, you probably wouldn't want those ones anyway. Every company that deals with IPO's has some formula for figuring out who would get shares and how many they would receive. Be very careful about dealing in this market. Good luck

2006-07-29 20:09:35 · answer #1 · answered by Gator714 3 · 1 1

The majority of IPOs are sold below their true market value. This is done on purpose. If you are able to buy most of these IPOs and sell them quickly, you could make a nice profit.

The only problem is that investment banks control the allocation of IPOs. They sell the lion share of the good ones to their best customers, and sell the the bad ones to the public.

So -- the way to get good IPOs to invest in is to do millions of dollars worth of business with some major investment banks.

2006-07-30 15:41:01 · answer #2 · answered by Ranto 7 · 0 0

dont invest in an ipo unless you absolutely don't need the money, because there is a very high chance that you could lose 50% to 80% of it. If you're willing to take the risk, some good buys would be the Chinese banks that are going to have IPO's soon: Bank of China and China Construction Bank.

2006-07-29 22:19:16 · answer #3 · answered by Anonymous · 0 0

http://biz.yahoo.com/ipo/

Check Hoovers, motley fool, or just google the business to find out info about them. IPO stands for Initial Public Offering. As a result they are going from private to public usually and they are smaller companies so there wont be too much info on them. That's why they have such a high rate of return, they have a higer rate of risk.

2006-07-29 18:54:49 · answer #4 · answered by RockStarinTx 3 · 0 0

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