What is an IPO (initial public offering) & Why Do Companies go Public?

In this video we explain what an IPO is, why a company might decide to IPO, and why it might NOT be a good idea to buy a stock that has just gone public...

"What is an IPO and can I buy an IPO stock?!" An initial public offering is the first time a private company's shares become available for you and I (as investors) to buy.

💡 Key Learnings:
0:00 1️⃣What is an IPO?
0:59 2️⃣The IPO Process
2:04 3️⃣Buying IPO stocks
3:02 4️⃣Should I buy an IPO stock?
3:42 5️⃣Direct Listing/SPAC vs IPO
4:34 6️⃣Private vs Public Companies

It's very tempting when you hear about a big company you know and love announce its IPO and its intention to go public. But should you invest in an IPO? The answer is - maybe.

As a beginner investor, it's important to be careful investing in IPOs, especially on the day of the IPO or soon thereafter. Always remember that the COMPANY is the one to decide when it goes public, so of course it is going to want to pick the most optimal time to IPO in order to raise the most money! Great for the company but perhaps not great for you as an investor ☝️

It's usually wise to wait a quarter or two in order for the company to release its earnings and allow you to get a better picture of how the company is performing. Remember, up until a company goes public, it doesn't need to release any of its financials - so the months following an IPO are when investors can really get a look at what's under the hood! 🔎

However, if you're super excited about the company and don't want to wait, that's fine, but we recommend allocating a portion of the funds that you have instead of the full amount. So for example, if have $500 that you're ready to invest and see an IPO that you want to buy, instead of putting the $500 all in on day 1, perhaps put in $150. Then wait a few weeks, see how the stock is performing, and then add a little bit more. This way, if the IPO stock jumps in the first few days, you'll still get to enjoy some of the gains, but if it drops, you won't feel as bad as if you had put all your money in on day 1! You get the best of both worlds 🙂

🎥 Video Production
Vidi.ie | http://bit.ly/Vidi-Productions
Graphics by Canva | http://bit.ly/Canva-30day-Free-Trial

📌 Topics
#IPO #initialpublicoffering #investing

🎵 Music
https://www.bensound.com/royalty-free...