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Invest in IPO’s?

One of my clients asked if I thought investing in initial public offerings (IPOs) is a good idea.

My opinion is that IPOs are exits for venture capitalists and angels. They are not an entry for retail (us).

In the last 360 days there have been 1,073 IPOs.

712 were negative (trading for less than IPO price).
361 were positive (trading for more than IPO price).

I don’t like those odds. I personally wait a few quarters to see the numbers and then make a decision about investing based on my own patented analysis.

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