There will be approximately 420 million shares of Facebook’s IPO set to be issued at around $34-$38 per share. This is the hottest IPO of the decade and multiple investors clamoring for the stock will have its valuation and price skyrocketing. So what are the options for a smaller investor who wants to own shares of the Facebook IPO?
- Try bidding on shares in a secondary market auction. SharesPost is a secondary market that sells Facebook shares at auction. Demand is fierce right now for Facebook, so be prepared to bid up your price if you want to own some shares of Facebook stock.
- Charles Schwab, E*Trade, TD Ameritrade and Fidelity have all said that they will allow small investors to purchase shares of Facebook’s IPO. Or they will at least allow them to try. If you have a brokerage account at Fidelity, you must have at least $500,000 in your account to even be considered for Facebook’s IPO. Even then, Fidelity clients who have been with them the longest will get priority. Most likely, institutional clients will get the lion’s share of Facebook’s IPO.
- Wait until all the smoke clears. Since smaller investors aren’t likely to get in on the feeding frenzy, it might be best to wait until the dust clears before purchasing Facebook stock. It’s quite obvious that Facebook’s IPO is dominating the media airwaves right now and causing even casual investors to want to buy the stock. This is going to drive up the price, so it might be prudent to wait for a bit of a cool down before purchasing Facebook shares. No company is immune to bad news, and if any were to hit Facebook in a few months after its IPO issue it could have a negative effect on the stock price.