Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Are You Wired For IPO Investing

IPOs are often great investments, but not every IPO is fit for everyone. When a new start-up goes public a lot of enthusiastic investors line up, but not all are making the right decision.
This deck explores areas of stock market research and business understanding that one needs to take care of in order to be successful at IPO investing. It touches up investing in sectors and themes, social media analysis, future of technology, market dynamics, investing strategies and hiring investment managers.

  • Login to see the comments

Are You Wired For IPO Investing

  2. 2. What is your level of general understanding of the market? Which way is the S&P 500 headed? IPOs follow the markets, of course, with a higher degree of volatility. But when markets are hot anyway, lot of IPOs happen. So how do you decide which ones to participate in? Go on ... Image from Flickr
  3. 3. Understanding sectors is important. An IPO in a hot sector will likely outperform the market by quite a bit. KNOW SOME SECTORS WELL ENOUGH TO TAKE YOUR PICKS? GREAT!
  4. 4. Do you make it a point to know the IPOing company well enough? There’s enough data & social opinion about unlisted companies for one to research them thoroughly. Right from their private investors and founders’ social footprints to their growth trajectory. And then there’s media – it often plays an important role in the success of IPOs. Image from Flickr
  5. 5. What’s your vision of the future! Flying cars? Teleportation? Work from anywhere? Genetically produced, but healthy veggies? Knowing WHY a sector is hot is probably more important than knowing which sectors are hot. A single Coca Cola stock bought at $40 in1919 is worth millions today.
  6. 6. Know the market dynamics! No. Not the stock market. The consumer and/or enterprise market that your investee company is operating in. Hyper-competitive segments see companies under constant pressure of eroding margins. This is alright for a private company looking for exponential growth but is a death knell for public companies and their stocks.
  7. 7. Is it a short- term or a long-term investment? We all like to avoid shorting an investment we just made. So, try to think like a dispassionate strategist and see if you agree with the business model, financial foundation and medium-term playbook the company seems to be following. See if you agree to these strategies!
  8. 8. Do you completely depend on investment managers? It’s highly likely that your area of knowledge and competence will be different from that of your money manager. Given that you need to invest only in sectors and companies you understand deeply, being self-directed could be a safer!