Point 2 is fallicious. If the company has been valued properly then buying at the IPO can be a good thing. FB was simply overvauled and people bought into the hype.
Not know about a lot businesses, for Hi-Tech companies, AFAIK, maybe only one company's share price never below its IPO price in its whole floating history, so far. This company is called Google.
Google's IPO price is $85. It hit $100 on its first day. It is still around $600 today.
You can always find good businesses, at a time its share is selling at a silly price that open the door to make your money. The longer a company on the public market, under public eyes, either a robust or a lousy business it could prove itself.
Interesting enough, Google's declared code of conduct is "Don't be evil", a phrase which they went so far as to include in their prospectus for their 2004 IPO, noting, "We believe strongly that in the long term, we will be better served — as shareholders and in all other ways — by a company that does good things for the world even if we forgo some short term gains."
Facebook, obviously, doesn't belong to this category at all in its IPO.
1. Never buy something hype
2. Never buy a business in its IPO
3. A business model that relies on trickery is doomed to fail
If you like the sound of bubble popped, keep watching this place.
Google's IPO price is $85. It hit $100 on its first day. It is still around $600 today.
You can always find good businesses, at a time its share is selling at a silly price that open the door to make your money. The longer a company on the public market, under public eyes, either a robust or a lousy business it could prove itself.
Interesting enough, Google's declared code of conduct is "Don't be evil", a phrase which they went so far as to include in their prospectus for their 2004 IPO, noting, "We believe strongly that in the long term, we will be better served — as shareholders and in all other ways — by a company that does good things for the world even if we forgo some short term gains."
Facebook, obviously, doesn't belong to this category at all in its IPO.