May 19, 2012

IPO Syndicate: If You Can Get It, Run The Other Way

The Big Picture has a terrific write-up on how IPO allocations work, in other words, who gets the goods at the offering price. Their example is Friday's Facebook IPO:

"In the end, the age-old Wall St. adage proved true yet again: Retail investors should be circumspect (to put it politely) of any offering they’re able to get their hands on. If you can get it, chances are you don’t want it.

How does the syndicate process generally work on the retail side? Herewith, a primer."