Contrarian IPO Thinking

While most of the media chatter has been about what a crummy year it has been for IPOs, one of the consequences of a difficult IPO market is that the companies that do make it public can outperform. I documented this a few years ago in a piece for TheStreet.com (post-boom technology IPOs actually did well), and something similiar is happening with the set of 124 companies that have come public so far this year on U.S. markets:

The average initial public offering of stock has seen a 11 per cent rise in its first day of trading so far this year, while a mutual fund that invests in IPO companies is up 155 per cent, according to Renaissance Capital, the firm managing the IPO fund. By comparison, the S&P 500 index has risen 0.8 per cent this year, while the Nasdaq Composite is down 1.6 per cent and the Dow Jones Industrial Average is off 2 per cent.

Related posts:

  1. Contrarian Thinking on Buyouts and VC
  2. “Experts” Awry on Google’s IPO Effects
  3. Lake Wobegon & Fund Managers
  4. Fund Managers Under-performance
  5. The Hedge Fund Chimera

Comments

  1. dilbert dogbert says:

    When I see “average” I always remember the “average” in the story about Bill Gates in the biker bar.
    Or Snow White and the Seven.