Investing 102

[GregWeld]

Just to "relate" the Facebook IPO (initial public offering) in this thread... My brokerage called yesterday to remind me that I must "reaffirm" my COTP (conditional offer to purchase) shares in the IPO. It will "price" after the market close TODAY. Then I must finish the paperwork (on line) that I understand the price AND still want to buy.

Okay --- I'm not a Facebook user. Never been to the site. NO I'm not excited by it. I am not above profiting from it however.

Let's put this COTP in perspective. IF I got the 2000 shares I asked for -- it's less than 1% (in dollar amount) of what is just in that one brokerage. I think it's GAMBLING..... but I want to put the perspective of what I'm willing to risk. LESS THAN 1% which overall is about .25% - That's POINT TWO FIVE PERCENT not a quarter of a percent - and not a quarter of what I have to invest.

I've had so many inquiries about how all this works and whether or not "they" should invest etc. THAT HERE IS WHY I'M POSTING THIS....

The number of people that have filled out COTP and have been DENIED is over 70%! According to my broker. The reason for denial??? They are NOT QUALIFIED... Either by "experience" or by percentage of net worth... or various other reasons. The brokerage reviews these COTP's and they will and do refuse to sell to people that are not qualified.

My guess is -- that the people that get turned down for the IPO price -- will turn right around and pay double on the retail market.... making this an even dumber "investment" for them.