Thursday, April 19, 2012

IPO East West Bank GT Capital Holdings

What I don't like about IPOs is that a few people setting the price of a business in which most people do not know the true value is. Given that logic, if you're a stock market investor, buying on IPO means you are betting not investing. You can't possibly set a price on a particular company before it made public and before it actually perform. That alone should tell you to be wary.

Although there are times (only a few times out of thousands) of companies that are golden gems wherein IPOS are very good price at the start. Google and Apple are 2 that I know of. But how many companies will actually be the next google and apple? Quite a few. Just by that numbers, the odds are not in your favor.

I did bought in the IPO of puregold and still holding into it. That is because I find the idea of selling to poor communities discounted retail products an amazing idea. For one, they tend to be strong during recession as many people would be buying discounted products during those times.

The current IPO east west bank and gt capital are in the industry that are easily affected by recession. And as an investor, you don't want to lose money. Finance and Real Estate are as volatile as the stock market. We may be seeing a real estate boom in the Philippines, but I would still prefer to bet my money on things that are sure and boring and people will always use recession or not.

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