Can I get a good IPO price?
Charlotte asks:
I have noticed that on the first day of an IPO, a company’s shares will usually take off.
I have noticed that on the first day of an IPO, a company’s shares will usually take off.
If Company X is going public and offers shares at $15.00.. would I get the shares at that price? Or is there more bs involved like there usually is with the stock market?
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It’s really not bs, it’s a matter of understanding supply and demand. Remember when you buy a stock it doesn’t matter if it’s an IPO or something that has been traded for 100 years, someone else (a person, we are called specialists) is selling you that stock. The reason the price of an IPO skyrockets is simply because of the demand of the public, the price will go as high as the investing public will take it. Remember the “market price” is the price that both parties are willing to buy and sell a security for. This is the ultimate example of capitalism.