The stock traded as high as $99.70 before drifting lower to finish the day...
By Greg Guenthner, Sept 22, 2014
It's off to the races!
All eyes were on Alibaba (NYSE:BABA) Friday morning as the record-breaking IPO finally started trading. Thanks to order imbalances, the exchange delayed the opening of trading for more than two hours. But even with the extra wait, investors impatiently gobbled up shares...
Early Friday morning, it looked as if BABA would begin trading around $80. That was moved to $83. Then, they raised it again. All told, the offering price ticked higher nearly a dozen times before BABA finally started trading. And when the stock started moving, you could see just how strong demand really was...
About 100 million shares of BABA exchanged hands during the first 20 minutes of trading, according to multiple reports. By the end of the day, more than 270 million shares had traded.
Of course, media reports on the IPO almost all touted the demand--and stock's 38% gain from its offering price. While it's true that BABA did jump nearly 40% in its first day of trading, there's no way your average investor captured any of these gains. In fact, if you bought BABA when it first began trading you're actually sitting on a loss right now...
BABA's big opening push actually faded as the day wore on. So if you bought as shares ticked toward $99, you'd be sitting on a loss of about 5% right now--not exactly the huge daytrading gains touted in the IPO-obsessed media reports.
There could be plenty of opportunities to trade Alibaba stock. But only if you're patient. Let's wait for this red-hot name to get some price history under its belt before we consider picking up shares...
All eyes were on Alibaba (NYSE:BABA) Friday morning as the record-breaking IPO finally started trading. Thanks to order imbalances, the exchange delayed the opening of trading for more than two hours. But even with the extra wait, investors impatiently gobbled up shares...
Early Friday morning, it looked as if BABA would begin trading around $80. That was moved to $83. Then, they raised it again. All told, the offering price ticked higher nearly a dozen times before BABA finally started trading. And when the stock started moving, you could see just how strong demand really was...
About 100 million shares of BABA exchanged hands during the first 20 minutes of trading, according to multiple reports. By the end of the day, more than 270 million shares had traded.
Of course, media reports on the IPO almost all touted the demand--and stock's 38% gain from its offering price. While it's true that BABA did jump nearly 40% in its first day of trading, there's no way your average investor captured any of these gains. In fact, if you bought BABA when it first began trading you're actually sitting on a loss right now...
BABA's big opening push actually faded as the day wore on. So if you bought as shares ticked toward $99, you'd be sitting on a loss of about 5% right now--not exactly the huge daytrading gains touted in the IPO-obsessed media reports.
There could be plenty of opportunities to trade Alibaba stock. But only if you're patient. Let's wait for this red-hot name to get some price history under its belt before we consider picking up shares...
Greg Guenthner heads up Agora Financial’s small-cap division and is the founder of one of the only independent OTC research advisories in the industry. A graduate of George Mason University, Guenthner joined Agora in 2005 after several years as a journalist.
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