initial public offering strategy
Initial Public Offering Strategy is to find companies that are soon to be publicly listed, or also known as floated, on one or more stock exchanges. To have a better understanding whether it is worth investing your time and money, before or after the “lock-up period” ends you should consider some of the steps mentioned below.
Firstly you should consider trying to find out as much information about a company prior to it being publicly listed. Good information to search for are a companies competitors, finances, past press releases and overall industry health.
Next, try and find companies with strong brokers, also known as underwriters. This is because established investment banks can afford to be more selective when choosing companies they wish to underwrite. Follow the link below for a list of the world’s top 10 investment banks.
Another great idea to help you decide if a company is worth investing into, is to read their prospectus. This is extremely beneficial as it provides investors with company information, such as it’s risks and future potential and how money raised by the IPO will be expended.
Lastly, but most importantly, especially if you’re new to investing, it is highly advised to wait until the lock-up period has passed. Lock-up period is when insiders are legally forbidden to sell any of their holding. Generally we like to wait and see if insiders continue to hold stock, as this can signal that insiders believe the current price is either fair and will appreciate overtime, or believe the current share price is undervalued.
Before acting hastily and buying stock in any recently publicly listed companies, we hope you apply the above steps to assist in investing wisely.
Initial Public Offering Strategy Conclusion
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