Is there a way the little people can benefit from IPO?

Question

Is there anyway the little people (people with 5K-10K to invest in stock) can benefits from IPO? Is there any company portal page (etrade, tradeking, share builder) that help the little investor buy IPO ALMOST immediately it becomes available. I mean why is it that its only the people with millions to invest that have access to it?

Answer 1

The little people who benefit from IPOs are not investors; they are rank-and-file employees of the company going public. Many of those companies have (or had) equity-based compensation for rank-and-file employees from early on. Microsoft, for example, is said to have created more millionaire secretaries that any other company before or after. A more recent example is UPS, where quite a few rank-and-file employees did well out of its 1999 IPO...

Answer 2

Here is the way IPOs work.

If the IPO looks good , Company insiders, Brokers, Broker insiders, and Big clients of brokerages, subscribe to all the stock in the IPO with none left over for the "Little Guy"

If the IPO doesn't look like a winner, Brokers and brokerage insiders, don't buy, they recommend against buying to their big, important clients, and all the stock is available for the "little Guy" (Cannon Fodder).

So the rule is...If you are a small investor, and have an opportunity to buy an IPO, WALK AWAY, real quick.

Answer 3

the reason being, they can play the financial market...thats the reason..coz..we are talking about millions here and 5K doesnt even fit the bill...

you can join hands with a group of professional investors/friends, and pool the fund and crack a deal...this way, there is a better possibility of allotment during IPO..

Chris
www.forexaim.com