Post: #1

1) How can I (as a retail client of etrade etc) gamble on my hunch of a public stock?

2) For a non-public stock, What can I do prior to the IPO?

3) fOn day one of their IPO?

This is a post about rampant speculation for those of us with play money.
This is not a post about investing.

Thanks.

WIA

Post: #2

If a company isnt public and doesnt issue stock I think you may need big money to invest. This is something I was recently wondering about. For those of you familiar with the O Pen vape in MJ legal states theu are highly popular. Anyhow they have a page on their site for investors but link is dead. I messaged them for details so if I hear back as far as min investment, return, what kind of reporting you get are all things Im curious about.

Post: #3

(08-08-2014 05:07 PM)WestIndianArchie Wrote:  1) How can I (as a retail client of etrade etc) gamble on my hunch of a public stock?

2) For a non-public stock, What can I do prior to the IPO?

3) fOn day one of their IPO?

This is a post about rampant speculation for those of us with play money.
This is not a post about investing.

Thanks.

WIA

Are you saying you think the company is overhyped and it's going to go down in price?

You can short a stock but that's margin work and in a heavily shorted name gets either very expensive or impossible (to short a stock, you have to borrow from someone who owns it, if nobody's willing to loan it, you can't be short).

Probably a better way to play is with options, because you don't have to own the stock. I've read up on options about a dozen times and I don't fully understand them, it's a complicated topic. Also understand that an option is a time-limited instrument and if the option's out of the money when it expires, you lose your entire investment. I'd start with searching out some info (Investopedia is a great resource) and probably spending the money on an intro type book. And play with fun money, because everybody I know who's played with options starts out losing money.

Pre-public, there are markets for pre IPO stock, but that's very difficult. Companies have right of first refusal on sales, so they can nix the sale at any time, and volume is small so you're dealing with an illiquid market. It's not possible to short a stock in a non-public company. SecondMarket is the best known exchange for pre-IPO securities, but remember there's significant restrictions on trading.

For day one stuff, I think you'd have to use options, probably in some sort of covered call strategy. You're dealing in a very illiquid security in a volatile situation, and acquiring a short position would likely be very difficult.

Post: #4

I dont want to piss on what rockhard said but almost all of it pertaining to options is false.

First off as a retail guy not much you can do other than wait for the IPO and short the stock. Depending on the liquidity that will determine the interest rate you have to pay on the stock. Basically if I buy the shares I can choose to have my brokerage lend you my shares at my determined rate. Remember though shorting the stock can only yield you a return of 100% maximum. The loss could be in theory though infinite.

The option part is wrong for a couple reason. First one being a covered call strategy is the exact opposite of what you are trying to do. That requires you actually buying the stock and it staying flat or it staying under the strike price of the call option for maximum gain. If the stock trades above the call strike price at expiration the stock will be taken away from you at that strike price. You would need a 100 shares for every call option SOLD

But you can't even use that strategy since options will not be available for at least 5-10 days after a company has gone public. Not all publicly traded companies even have options. Options are available to highly liquid stocks. Most publicly traded companies or financial instruments do not have options