Thursday, September 22, 2005

Global Cash Access Holdings ipo

I usually avoid ipo's because it's simply risky. Earlier this week, I placed an order for some ipo shares of Global Cash Access Holdings (GCA). The expected pricing range was $12-14 and tonight the shares were priced at $14, the high end of the range. That's a good sign. I won't know until tomorrow morning if I was allocated any shares. Hopefully I'll receive a small allocation, but not all that I requested. In a well received deal, you'll only receive a small fraction of the total shares requested. For example if you place a conditional offer for 500 shares, they may give you only 100 shares. If you receive the entire allocation of the shares requested then you're in big trouble. Sell right at the open. That's a sign of weak demand. So be careful with ipo's. Here's one of my favorite sites for ipo research, IPO Home, click here.

With all this pessimism brewing out there, I'm actually starting to get a bit more bullish. We'll see...


At September 25, 2005, Anonymous Anonymous said...

Very interesting, I didn't know that about IPOs.

At September 25, 2005, Blogger Money Turtle said...

Another thing to look at is pricing. You always want the ipo to be priced towards the high end or above the estimated pricing range. That's a sign of strong demand. If they start cutting the price of the ipo, stay away.


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