Getting Ready for the Facebook IPO

By Ryan P., Service Center Supervisor and Guest Blogger

Looking to raise nearly $5 to $10 billion, Silicon Valley’s Facebook, Inc. (FB) could possibly be one of the biggest initial public offerings (IPOs) in history. And, when the IPO debuts on the NASDAQ, the big question mark hanging over nearly every trader and investor will be: Should I buy or trade Facebook?

Several of you have even asked questions on our Facebook and Twitter pages about the Facebook IPO and here is what we can tell you:

• The expected initial public offer date for Facebook is May 17.
• Scottrade will not have access to Facebook IPO shares at the IPO price because we are not an underwriter for the IPO.
  
• Shares may be available to buy or trade online through your Scottrade account when it goes to the secondary market. Shares in the secondary market can begin trading anytime on or after the day of the initial public offering. At this time we do not know when shares will be available in the secondary market.

Getting Prepared
Like you and much of Wall Street, our trading desk is gearing up for the much anticipated Facebook IPO. Although it may seem straightforward or tempting to start trading a company you know, like Facebook, you should evaluate your decision and spend time researching not only the company and its prospectus, but also what is going on in the market. The Daily Market Commentary Series¹ and Strategy Sessions¹ by Learning Markets, for example, is one educational source that can help with fundamental and technical analysis so you can make an educated decision about whether or not to own certain stocks or securities.

You should also fully understand what type of orders you can place. Our Knowledge Center and KnowHow^® News articles are two resources that provide helpful information and tutorials about order types.

A Look at Past IPOs
Only time will tell how Facebook will do on May 18 and as a publicly traded company. Some IPOs have floundered despite much fanfare, while others continue to do well in their market or sector. Zynga (ZNGA), the maker of games such as ‘Farmville’ and ‘Words with Friends,’ and LinkedIn (LNKD), another popular social networking site, certainly don’t compare to the speculated market value of Facebook, but it is interesting to see how many orders were executed at Scottrade when they started trading in the secondary market and how they are doing today.

What do you think about Facebook’s IPO and where the company is headed?

Related Content About IPOs:
What You Need to Know About IPOs

Ryan P. supervises brokers who help answer client questions in online chat and social.

Any strategies described in this article are for information purposes only and their use does not guarantee a profit. None of the information provided should be considered a recommendation or solicitation to invest in, or liquidate, a particular security or type of security. Investors should fully research any security before making an investment decision.

¹The Scottrade^® Daily Market Commentary Series and Scottrade^® Daily Strategy Series are produced by Learning Markets, LLC. The materials presented are being provided to you for educational purposes only. Scottrade, Inc. and its affiliates have not created and are not responsible for such materials. The content of such materials has not been adopted, endorsed or approved by Scottrade or its affiliates. The content was created and is being presented by employees or representatives of Learning Markets, LLC who are not employed by or affiliated with Scottrade or its affiliates. The information presented or discussed is not a recommendation or an offer of, or solicitation of an offer by, Scottrade or its affiliates to buy, sell or hold any security or other financial product or an endorsement or affirmation of any specific investment strategy. You are fully responsible for your investment decisions. Your choice to engage in a particular investment or investment strategy should be based solely on your own research and evaluation of the risks involved, your financial circumstances and your investment objectives. Scottrade and its affiliates are not offering or providing, and will not offer or provide, any advice, opinion or recommendation of the suitability, value or profitability of any particular investment or investment strategy.