With IPO excitement again hitting the market pretty hard over the last six months, including the crazy performance of Yandex and LInkedIn, and the increasing lust for a “someday” Facebook IPO, I thought today’s Friday File it might be a good time to take a look at this new teaser from Jon Markman.
Markman’s newsletter doesn’t often tease stocks in their ads — he’s more of a trader, so he teases us about his techniques and past performance — but I’ve written about his ideas on occasion. This time it’s sort of a mix — he tells us that he’s got the best way to trade IPO stocks, but he also teases us about two specific ideas.
So what’s his strategy?
Here’s how he introduces it in the ad:
“The Secret to Trading Hot IPOs
“Avoid the Feeding Frenzy and Make a Ton of Money…
“The stock market is catching a wicked case of IPO fever. Which means there is a ton of money to be made right now by traders like us.
“But if, and only if, you know how to play it right.
“You probably noticed the wild ride of white-hot IPO LinkedIn. As the first social networking company to go public, this much anticipated and overhyped event became a frenzy of speculation, with more LinkedIn shares traded on its first day than traded that day in Apple, Baidu, Google, Amazon, and Netflix… combined.
“While frenetic trading may have handsomely rewarded a few privileged fat cats by day’s end, it left many regular traders licking their wounds and counting their losses, as the price rose then dove in a quick and dangerous game of musical chairs — Wall Street style.”
So that caught my interest. What, then, is his strategy?
“The Smarter, Safer Way to Big IPO Gains
“I’m Jon Markman, and I love trading IPOs for big gains. But let me repeat for you one thing I made clear well in advance to my Trader’s Advantage readers: I wouldn’t go anywhere near LinkedIn shares on day one, day two or even day ten of its trading.
“That kind of Wild West action is just way too dangerous and unpredictable.
“You see, within minutes of becoming public, the froth had made LinkedIn the most expensive shares in the U.S. on a price-to-sales basis. It was like the worst of 1999 all over again.
“Now there ...