Beware of IPO Hype

1. Investing in an IPO
If you are an individual investor in the stock market and get involved in an IPO when
it first comes out, most of the time you will lose money. Don't be fooled by all the
hype on CNBC or other financial networks about the IPO's. Just in 2019 the majority
of IPO's opened high and then crashed. Some as much as 50% after a few days. Why?
Because the investment firms that back the IPO can make big bucks upfront and the
little guy takes the hit. Take SmileDirect. Opened at $23 now under $10.00 in 2
weeks! Crowdstrike went from $76 to $51 in 2 weeks. These are just 2 of many IPO's
that come out these days. They may be good companies in the long run but they are
being overpriced at the open by the investment firm that backed the company. You
may also notice if you read up on these IPO's on google that there are many class
action suits against the companies because so many investors lost so much money in a
short period of time.
My advise, do your due diligence before investing stay away from IPO's until the dust
settles.