Loyal3 First Data (FDC) IP BustThis past week I invested $20,000 in getting IPO share allocations of First Data (FDC) via Loyal3 trading platform. Up until this point, EVERY IPO that has been made available via Loyal3 has had a positive return on DAY 1....Until now.
Lesson's Learned when buying IPO's via Loyal3:
- If the IPO is available on Loyal3 for a long time (a day or longer) then, that may mean there might NOT be strong interest in the stock. First Data (FDC) was available for a full day and the hotter IPO's usually will be unavailable within a couple hours.
- If the price for the IPO is set lower then the price range initially given, this might also be another warning sign. You would think that it's a good thing if the price is set lower, but I think this is actually signaling lower interest in the stock, which will then NOT have as much hype and "pop" when it goes public. The price is set the day before the stock goes public. For First Data, the price range was listed on the prospectus as $18-$20. The final price set the day before going public was $16.
First Data (FDC), has been up and down $16 since it's IPO, but I'm still glad I sold on day one. I feel the risk of staying in with a company I don't have interest in is not worth the risk. This is just my strategy. Although, there is the school of thought that you should never invest in a stock, even for a minute, that you are not willing to keep for the long term (3+ years).
Even though First Data was a failure for me, I still think there is tremendous opportunity in acquiring IPO's.
What has been your IPO experience?