Here’s How Traders Did Flipping Groupon, LinkedIn, And Pandora Stock On IPO Day (GRPN, LNKD, P)

Source: http://www.businessinsider.com/chart-of-the-day-heres-how-traders-did-flipping-groupon-linkedin-and-pandora-stock-on-ipo-day-2011-11

IPOs are rigged. They’re set up so that the banks who underwrite them can get their best clients in before the stock inevitably pops.

This reality does not, however, keep traders from trying to take advantage of that pop. It doesn’t always work out.

For example, according to SigFig, most people who bought and then sold Groupon stock during its IPO lost money.  Just more than 1.16% of them got a 10% return.

Traders who played the IPO game with LinkedIn were more likely to be winners. Only ~5% of them lost money. A tiny slice of them – 0.76% – actually doubled their investment.

SigFig made a cool chart to illustrate all this:

COTD Groupon

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By: Dr. Augustine Fou Thursday, November 17th, 2011 news

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Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.

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