Investor and IPO: A Comprehensive Guide to Participation Strategy and Risk Management
The IPO market is experiencing a powerful resurgence in 2025 following three years of stagnation due to global economic uncertainty. According to global analysts, the number of IPOs in the U.S. is expected to nearly double by mid-2025 compared to the total figures for 2024, with some offerings, such as CoreWeave and Circle Internet Group, demonstrating growth of 140% and 300%, respectively, from their offering prices. For investors, this presents both new opportunities for capital growth and increased risks, necessitating a deep understanding of participation mechanisms and a disciplined portfolio management approach.
However, the attractive statistics of successful offerings often conceal a less rosy picture: a significant portion of IPOs trades below their offering price just a few months after going public. This is why understanding not only the opportunities but also the pitfalls of initial offerings becomes a critically important skill for the modern investor.
What is an IPO and Why is it Important for Investors
An Initial Public Offering (IPO) is a process through which a private company sells its shares to a wide range of investors on a public exchange, such as the NYSE, NASDAQ, or the Moscow Exchange, for the first time. This event marks the transition from a closed ownership structure to an open one, providing the company access to substantial capital for business expansion, debt repayment, or early investor exit.
For investors, an IPO opens a unique opportunity to enter potentially transformative businesses at an early stage in their public life, when prices have not yet fully reflected growth potential. History offers numerous examples where early investors in IPOs of companies like Amazon, Google, or Tesla achieved returns that far exceed their initial investments. However, for every success story, there are several instances where high-profile IPOs disappointed investors within the first few months of trading.
Stages of the IPO Process
The IPO process involves several critical stages, each of which affects the ultimate success of the offering. The company begins by preparing regulatory documents, including a prospectus that contains detailed information about the business, financials, risks, and plans for the raised capital. Next, investment banks are selected as underwriters to organize the offering and guarantee the buyback of a certain number of shares. The next stage is the roadshow, during which the company's management presents to large institutional investors worldwide, convincing them of the investment's potential.
The book-building process allows for the determination of actual demand and the establishment of the final offering price. After this, the shares are listed on the exchange, and public trading begins. Unlike buying shares on the secondary market, participating in an IPO gives an investor the potential opportunity to purchase shares at the offering price before public trading begins, which can lead to significant profits on the first trading day. It is this opportunity to profit from the difference between the offering price and the opening trading price that attracts thousands of investors to participate in IPOs.
Types of Offerings: From Pre-IPO to SPO
The modern capital market offers investors a spectrum of opportunities to participate in public offerings that extend far beyond classical IPOs. Pre-IPO investments provide the opportunity to purchase shares of a company before the official offering, usually on terms that are not available to the general public. This instrument requires the status of a qualified investor and typically involves minimum investment amounts in the millions, but in return offers potentially more favorable valuations compared to the IPO.
Pre-IPO: Opportunities for Qualified Investors
The pre-IPO market has been particularly invigorated in recent years with the emergence of specialized platforms that allow affluent private investors access to deals previously available only to venture funds. However, this segment carries increased risks: a lack of liquidity until the IPO, uncertainty regarding timing and the success of the offering, and the possibility that the company may not go public at all.
Classic IPO and Alternative Mechanisms
The classic IPO remains the most widely used and understood format for most investors. Here, a company offers its shares to the general public for the first time, ensuring equal access for both institutional and retail investors (although the distribution of shares may not be equal). Secondary Public Offerings (SPO) and Follow-on Public Offerings (FPO) are secondary offerings where an already public company issues additional shares to raise capital for development or debt refinancing. These offerings are typically less volatile than primary IPOs, as the company has an existing public trading history and quarterly reporting.
Direct Public Offerings (DPO) or direct listings are a relatively new mechanism gaining popularity among tech companies. In this case, a company lists shares without the involvement of underwriters, which reduces costs by 3-7% of the offering volume but eliminates support in pricing and marketing. Spotify and Slack successfully utilized this mechanism, although for most companies, a traditional IPO with underwriter support remains the preferred option.
Industry Trends for 2025
In 2025, the most promising sectors for IPOs have become fintech, artificial intelligence, biotechnology, and renewable energy companies. Tech companies, particularly in the AI and machine learning segments, are attracting the most attention from investors, demonstrating impressive valuation multiples. The biotech sector is experiencing a renaissance due to breakthroughs in gene therapy and personalized medicine. Sustainable energy and climate technologies are receiving additional momentum from government programs promoting the green transition in the U.S., Europe, and Asia.
Participation Strategies: From Conservative to Aggressive
The choice of investment strategy for IPOs is determined by a combination of factors: investment horizon, risk tolerance, overall portfolio structure, and the investor's life goals. A long-term strategy focused on holding shares for 3-5 years or more emphasizes the fundamental quality of the business, competitive advantages, and growth potential of the industry. Such investors ignore short-term volatility and are willing to withstand temporary downturns if they believe in the company's long-term transformation.
Long-term Investing: The Path to Maximum Returns
History shows that the best results from IPO investments are achieved by patient long-term investors. Those who bought shares of Amazon at its IPO in 1997 at $18 and held them to the present day have achieved returns exceeding 100,000%, despite numerous periods of volatility and declines of 50-80% during crisis years. Similar stories can be told about Google, Netflix, and dozens of other companies that turned patient investors into millionaires.
Flipping: Short-term Speculation in IPOs
Flipping or short-term speculative strategy occupies the opposite end of the spectrum. Here, the goal is to sell shares in the first days or weeks following the offering to secure a quick profit from the initial price rise. Statistics show that many successful IPOs of 2025 demonstrated growth of 20% to 100% on their first trading day, making flipping attractive for aggressive traders. CoreWeave soared 140% on its first day, while Circle Internet Group showed a growth of over 300% within the first week of trading.
However, this strategy requires quick reactions, discipline, and an understanding of market psychology. Flipping carries the risk of buying at the peak of euphoria when institutional investors are already taking profits. Many retail investors attempting to profit from flipping buy shares not at the offering price (which they simply don't have access to due to zero or minimal allocation) but at the opening trading price, which can be 30-50% higher than the IPO price. As a result, they often enter at a peak and incur losses during subsequent corrections.
A Balanced Portfolio Approach
A balanced portfolio strategy involves allocating a strictly limited portion of capital to IPO investments – typically no more than 5-20% of the overall portfolio. This portion should be distributed among several companies from different sectors to mitigate specific risks. Experts recommend not concentrating the entire IPO capital into one offering, no matter how promising it seems. Even the most carefully selected IPOs can disappoint: the company may fail to meet revenue expectations, encounter regulatory issues, or face sanctions.
Combining IPO shares with more stable and predictable assets helps balance the overall risk of the portfolio. Bonds, dividend aristocrats, gold, and real estate act as ballast to compensate for the high volatility of young public companies. Proper diversification allows an investor to sleep soundly at night, knowing that even a complete failure of one or two IPOs won’t destroy their entire portfolio.
Company Valuation: Key Metrics and Analysis Methods
Properly valuing a company before participating in an IPO becomes a fundamental skill that separates disciplined investors from speculators chasing hype. The Discounted Cash Flow (DCF) method remains the gold standard for valuing companies with stable and predictable financials. This method relies on forecasting the future free cash flows of the company over a 5-10 year horizon, summing them with the terminal value, and discounting to present value using a discount rate that reflects the cost of capital and business risks.
DCF Analysis and Its Limitations
For startups and rapidly growing tech companies that are not profitable, DCF analysis becomes more speculative as it is based on many assumptions about future growth. In such cases, investors often turn to multiple analyses, which use comparative ratios of publicly traded peer companies. P/E (price to earnings) works for profitable companies, EV/EBITDA (enterprise value to operating income) allows for comparison of companies with different capital structures, while P/S (price to sales) is used for unprofitable companies with rapidly growing revenue.
Key Metrics for Tech Companies
For tech companies that often lack profits at the time of IPO, particular attention is given to revenue growth metrics (ideally 40-100% year-over-year), gross margin (indicating the scalability of the business model), and unit economics metrics, such as LTV/CAC (lifetime value to customer acquisition cost). A company with an LTV/CAC above 3 and a customer acquisition payback period of less than 12 months demonstrates healthy economics and potential for sustainable growth.
Analysis of Financial Trends
Analyzing financial trends often proves more critical than absolute metrics. A company that increases revenue from $50 million to $200 million over three years while improving its gross margin from 40% to 60% demonstrates operational excellence and scalability. In contrast, a slowdown in revenue growth from 100% to 30% per year, while simultaneously increasing operational losses, signals issues with the business model.
Qualitative Factors in Valuation
Qualitative factors play an equally important role in assessing IPO prospects. Competitive advantages or an "economic moat" determine whether a company can protect its profitability from competitors over the long term. Network effects (as seen with Facebook), high switching costs (like with Microsoft), branding (as with Apple), or patents and regulatory barriers (as seen with pharmaceutical companies) create sustainable competitive advantages.
The quality and experience of the management team is critically important. Founders who have previously successfully taken companies public or built large businesses hold an advantage over novices. Analyzing the prospectus should include a detailed examination of the Risk Factors section, where the company is required to disclose all substantial risks to its business. This section often contains critical information about dependence on key clients, regulatory threats, litigations, and other factors that could negatively impact future performance.
Risk Management: Safeguarding Capital in a Volatile Market
Investing in IPOs involves risks that significantly exceed those associated with investing in mature public companies. The volatility of the first weeks and months of trading can be extreme: price swings of 20-50% during a single trading session are not uncommon. Some IPOs of 2025 exhibited intra-day fluctuations of up to 40-50% from their offering price within the first month of trading. Low liquidity in the early stages exacerbates these price swings, especially for mid-sized companies with relatively small free floats.
Systemic and Specific Risks
Systemic or market risks are related to the overall stock market condition and the macroeconomic situation. If an IPO occurs at a market peak or just before a correction, even a quality company may suffer from a general sell-off. History shows that IPOs conducted in 2021 at the height of the tech boom lost on average 50-70% of their value during 2022-2023 amidst the general decline in growth stock prices.
Specific risks pertain to the particular company: failure of a new product, loss of key clients, regulatory issues, management scandals, or inability to meet revenue forecasts. Young public companies are particularly vulnerable to such shocks, as they do not yet have a buffer of a diversified business and sustained cash flow.
Stop-Loss and Take-Profit: Basic Protection Tools
Stop-loss and take-profit orders serve as the primary capital defense tools for active investors. Setting a stop-loss at 15-20% below the purchase price helps limit potential losses if shares start to display a consistent decline without fundamental reasons for recovery. A take-profit allows for automatic profit-taking when a previously defined growth level, such as 30-50%, is reached, which is especially important for short-term flipping strategies.
However, the mechanical application of stop-losses requires caution. Overly stringent stop-losses could lead to premature exits during temporary corrections that are part of the normal price dynamic of young stocks. A trailing stop (a moving stop-loss) that automatically rises alongside price growth protects accumulated profits while allowing shares the space to grow.
Hedging and Diversification
Hedging options become available for large and liquid IPOs where the options market forms a few weeks after listing. Purchasing protective put options offers insurance against significant price declines by establishing a minimum price at which shares can be sold. This strategy incurs additional costs for the option premium (typically 2-5% of the position's value) but provides peace of mind and protection during periods of high uncertainty.
Time-based diversification reduces the risk of concentrating all capital in one market cycle. Instead of investing the entire allocated IPO capital into a single offering or within one quarter, it is wiser to disperse investments among multiple IPOs throughout the year. This averages the entry points and reduces the likelihood of hitting an euphoria peak.
Lock-Up Period: A Hidden Threat for Unprepared Investors
The lock-up period is one of the most underestimated risks for IPO investors, capable of triggering a sharp drop in share prices by 10-30% within days. This period, typically lasting from 90 to 180 days after the IPO, is established by an agreement with underwriters that prevents company insiders—founders, option-holding employees, early investors, and venture funds—from selling their shares on the open market.
The Logic and Purpose of Lock-Up
The logic behind the lock-up is straightforward: it protects new public investors from an immediate mass sell-off of shares by those who held them prior to the IPO at significantly lower prices. Without a lock-up, a founder who received shares at $0.01 and sees them trading at $20 after the IPO would have enormous incentives to immediately sell a large portion of their stake, securing a profit of 2000x. A mass sell-off by insiders would crash the price, harming new investors and undermining trust in the company.
What Happens After the Lock-Up Expires
However, the end of the lock-up often becomes a moment of truth for IPO shares. When restrictions are lifted, an offering may flood the market that exceeds the original free float several times over. If insiders begin actively selling shares, this creates price pressure and may signal a lack of confidence in the company's future growth. Statistical studies show that on average, shares tend to drop by 1-3% on the day the lock-up expires, and with active insider selling, the decline can reach 10-20% within a week.
How Investors Can Use Knowledge About Lock-Up
It is important to understand that the lock-up period usually does not affect retail investors who bought shares in the IPO or on the secondary market after the listing. Restrictions apply only to those who owned shares before the IPO. Nevertheless, retail investors should be prepared for increased volatility and potential price declines upon the expiration of the lock-up.
The lock-up expiration date can always be found in the prospectus in the "Shares Eligible for Future Sale" section or a similar one. Monitoring insider selling through regulatory documents such as Form 4 in the U.S. or similar disclosures in other jurisdictions helps gauge management’s and significant shareholders' sentiments. If the CEO and CFO are actively selling shares immediately after the lock-up expiration, this may be a concerning sign, especially if they are not providing public explanations (for instance, diversifying personal wealth or tax planning).
Strategies for Dealing with Lock-Up
Some seasoned investors' strategies involve waiting until the lock-up expires before buying shares. This allows them to avoid the risk of a price drop and often provides the opportunity to purchase shares at a more attractive price after a correction. An alternative strategy is partial profit-taking just before the lock-up expiration, especially if the shares have significantly risen from the IPO price, followed by the potential to buy more after price stabilization.
Book-Building and Allocation: How Share Distribution Works
Book-building is a critically important stage of the IPO during which underwriters gather orders from potential investors to determine the optimal offering price and assess actual demand for shares. The process typically lasts from one to two weeks and begins after completing the roadshow, during which the company's management has already presented to major institutional investors.
Establishing the Offering Price
The company and underwriters set a preliminary price range, for example, $18-$20 per share, based on a comparative analysis of similar public companies, financial forecasts, and initial discussions with anchor investors. During the book-building period, investors submit requests indicating the desired number of shares and the maximum price they are willing to pay. Institutional investors typically submit larger requests and have the opportunity for direct communication with underwriters to discuss terms.
Based on the collected demand, underwriters determine the final price for the IPO. If demand significantly exceeds supply (a 5-10 times oversubscription is common for popular IPOs), the price can be set at the upper end of the range or even above it. If demand is weak, the price may be lowered or the offering postponed until market conditions improve.
The Mechanism of Share Allocation
Allocation or distribution of shares among investors becomes a balancing act, where underwriters strive to create a stable shareholder base that enhances successful trading post-listing. Institutional investors with a long-term horizon—pension funds, insurance companies, asset managers—typically receive priority as they provide stability and are less likely to sell shares immediately for quick profits.
Retail or individual investors typically receive only a small share of the total offering, often 10-20%, and in cases of high oversubscription may receive only a small percentage of the requested amount. If an investor requests 1000 shares under a 10 times oversubscription, they may receive only 100 shares or even a zero allocation. Zero allocation is especially common among small retail investors during the most popular IPOs, where demand from institutional investors already covers the entire offering several times over.
How to Increase Your Chances of Allocation
Retail investors can enhance their chances of receiving an allocation in several ways. Using a broker that is part of the underwriting syndicate is critical since brokers outside the syndicate have no access to shares at the offering price. Submitting non-limited orders (indicating willingness to accept any price within the set range) may increase chances, though this carries the risk of receiving shares at the upper end of the range. Participating in less promoted but quality IPOs of mid-sized companies often provides better allocation than attempting to obtain shares in mega-popular offerings.
Qualified Investor: The Key to Exclusive Opportunities
The status of a qualified investor opens doors to investment opportunities not available to regular private investors, including pre-IPO deals, structured products, hedge funds, and other alternative investments. In Russia, the criteria for obtaining this status were significantly revised in 2025. The primary route is having financial assets (securities, cash in accounts) totaling at least 24 million rubles, which is approximately equivalent to $250,000.
Ways to Obtain Status
Alternative pathways include professional education in finance and at least three years of experience in the financial sector or executing securities transactions totaling at least 24 million rubles over the past two years, with a frequency of at least one transaction per quarter. Certain categories of investors obtain this status automatically: professional participants in the securities market, brokers, asset management companies, and their employees with relevant qualifications.
Benefits and Risks of the Status
The benefits of being a qualified investor are significant. Access to pre-IPO platforms allows investment in promising companies 6-24 months before public offerings at valuations potentially 30-50% lower than the expected IPO price. The ability to invest in closed mutual funds and venture capital funds offers access to professionally managed portfolios of startups and growing companies.
However, the status also carries increased risks and responsibilities. Qualified investors do not receive the same level of regulatory protection as regular private investors. It is assumed that they possess sufficient knowledge and experience to independently assess risks and make informed investment decisions. Many instruments available to qualified investors have low liquidity, long lock-up periods, and no guarantees of a return on investment.
Who Needs Qualified Investor Status
The decision to obtain qualified investor status should be based on a genuine need for access to specialized instruments rather than a desire to gain prestige. For most retail investors, a broad range of public stocks, bonds, funds, and ETFs in a regular brokerage account provides sufficient opportunities for building a diversified portfolio. The status becomes justifiable for wealthy investors with capital exceeding $500,000 who are seeking alternative sources of returns and are prepared to accept increased risks and low liquidity.
Practical Recommendations: A Step-by-Step Plan for Participation
Successfully participating in an IPO requires a systematic approach and prior preparation. The first step is to open a brokerage account with a company that provides access to primary offerings. Not all brokers have this capability, so it is essential to choose one that regularly participates in underwriting syndicates or has partnerships with investment banks. To participate in international IPOs on the NYSE or NASDAQ, an account must be opened with an overseas broker or a Russian broker with access to American markets.
Step 1: Preparing the Infrastructure
Monitoring the calendar of upcoming IPOs should become a regular practice. Specialized resources, financial media, and analytical sections of brokerage platforms publish information on planned offerings weeks or months before the event. Early identification of interesting opportunities provides time for in-depth analysis of the company, examining industry trends, and making a well-informed decision without rush.
Step 2: Analysis and Due Diligence
Analyzing the prospectus should begin 2-4 weeks before the acceptance of applications. This voluminous document (often 200-300 pages) contains all essential information about the company: business model, financial statements for the last 3-5 years, description of the competitive landscape, plans for the use of raised capital, and, importantly, the risks section. The Risk Factors section warrants special attention, as the company is obliged to disclose all significant threats to its business.
Comparative valuation of the company against public peers helps determine whether the proposed IPO price is fair, overvalued, or undervalued. If the company is valued at 15x sales while mature competitors in the same industry are trading at a multiple of 5-7x, this may signal overvaluation unless the company demonstrates significantly higher growth rates or better economics.
Step 3: Submitting an Application and Managing the Position
Determining the size of the position requires discipline. It is generally recommended to allocate no more than 2-5% of the total portfolio to a single IPO, even if the company appears exceptionally promising. This limits potential losses and protects against excessive concentration in high-risk assets. The choice between limit and non-limit orders depends on the level of confidence in the company and the willingness to accept a price at the upper end of the range.
After receiving allocation and trading begins, it is critically important to promptly set stop-loss and take-profit orders. This ensures discipline and protects against emotional decisions during periods of high volatility. Monitoring corporate news, quarterly earnings reports, and insider selling in the first months allows assessment of whether the company meets initial expectations.
Step 4: Long-Term Management and Rebalancing
Regularly rebalancing the portfolio every 3-6 months helps maintain the target risk level. If an IPO stock has grown and now constitutes 10% of the portfolio instead of the initial 3%, it makes sense to partially secure profits and return the position to its target size. A planned review of the investment thesis 6-12 months after the IPO, when the company has published several quarterly reports, allows for informed decisions regarding holding, increasing, or cutting the position based on fundamental metrics.
Investor Psychology and Common Mistakes
Psychological traps often prove more dangerous for portfolio returns than fundamental analysis errors. FOMO (fear of missing out) can lead investors to buy shares at the peak of excitement at inflated prices, often in the first minutes of trading when volatility is at its highest. A classic example: investors buying shares of a hot IPO at an opening price of $50 (with an offering price of $30) may find themselves facing 20-40% losses within a few weeks as initial euphoria dissipates.
FOMO and Emotional Decisions
Market history is replete with examples where mass retail excitement surrounding IPOs coincided with peaks in valuations. In 2021, dozens of tech company IPOs opened at a premium of 50-100% over the offering price, attracting thousands of private investors fearful of missing out on the "next Tesla." By the end of 2022, most of these companies traded 60-80% below their peak values, leaving late buyers with catastrophic losses.
Concentration and Diversification Errors
Insufficient diversification is a classic mistake when an investor concentrates 30-50% or more of their portfolio in one or a few IPOs, hoping for quick riches. The mantra "don't put all your eggs in one basket" is especially relevant for IPO investments, where risks are significantly higher than those of mature public companies. Even professional venture funds specializing in high-risk investments expect that 60-70% of their portfolio companies will yield zero or negative returns, with the fund’s entire profit coming from 10-20% of successful investments.
Ignoring Fundamental Analysis
Ignoring fundamental analysis in favor of hype and following the crowd without doing personal research leads to involvement in low-quality offerings. When everyone is talking about a "revolutionary" company with a "unique technology," it’s crucial to conduct independent analysis and ask hard questions: does the company have a path to profitability? How substantial is the competition? Are the technologies secured by patents? Is the total addressable market (TAM) realistic or exaggerated marketing?
Lack of an Exit Plan
A lack of a clear exit plan leaves investors without criteria for locking in profits or limiting losses. Before entering the trade, conditions under which the position will be closed should be defined: target profit level (e.g., +50%), maximum acceptable loss (e.g., -20%), time horizon (e.g., 12 months), or fundamental triggers (e.g., three consecutive quarters of revenue growth slowing).
Emotional attachment to a company's "success story" impedes the objective evaluation of changed circumstances. An investor enamored with the company’s narrative at the IPO stage often refuses to acknowledge red flags: departure of key employees, lawsuits, product failures, or intensifying competition. Disciplinary adherence to pre-established exit rules, regardless of emotions, becomes a key component of long-term success in IPO investing.
Conclusion: Turning Opportunities into Outcomes
Investing in IPOs in 2025 presents unprecedented opportunities for capital growth amidst the resurgent global IPO market following a three-year stagnation. However, turning these opportunities into real profits requires much more than luck or following the crowd. Success comes to investors who combine deep fundamental company analysis with disciplined risk management, appropriate positioning in the portfolio, and emotional resilience in the face of inevitable volatility.
Understanding the entire IPO ecosystem—from book-building mechanisms and allocation intricacies to company valuation methods, specific lock-up period risks, and psychological traps—transforms participation in initial offerings from a gamble into a calculated investment strategy. By following a step-by-step preparation plan, diversifying investments among several promising companies from various sectors, and avoiding common emotional investing mistakes, IPOs can be effectively leveraged as a powerful tool to achieve long-term financial goals.
A key success factor is the ability to assess the fair offering price calmly, choose the right entry moment, maintain disciplined risk management, and systematically rebalance positions as new information about the business and the market accumulates.
Brief Investor Checklist Before IPO
Goal and Horizon. Define the purpose of participation: short-term speculation, medium-term growth, or long-term stake in the business, and set a specific time horizon for holding a position.
Position Size. Determine the portion for a single deal within 2-5% of the portfolio and the overall limit for the asset class IPO at 5-20%, considering personal risk tolerance.
Valuation and Metrics. Compare multiples with industry peers and growth rates with the company's history; check key revenue drivers, margins, and unit economics.
Prospectus and Risks. Carefully review the risk section, capital structure, lock-up terms, use of raised funds, and potential legal obligations.
Allocation and Applications. Clarify the likelihood of distribution through your broker, consider the type of order (limit or non-limit), and scenarios for partial or zero allocation.
Management Plan. Pre-define stop-loss levels, take-profit conditions, criteria for increasing and reducing positions, and dates for revisiting the investment thesis.
Diversification and Correlation. Assess how the new position will alter the risk profile of the portfolio and its correlation with major indices and key sectors.
Calendar Events. Note lock-up expiration dates, earnings report release dates, and potential corporate actions that may increase volatility.
Risk Warning
Investing in IPOs involves high uncertainty, potential for sharp price fluctuations, and the risk of partial or zero allocation in cases of oversubscription. Even quality companies may exhibit negative returns in the first months of trading, and the conclusion of the lock-up period often provokes short-term selling pressure. Decisions to participate should be made with consideration for personal financial planning, liquidity reserves, and readiness for temporary downturns.
Glossary of Key Terms
Allocation
Distribution of stocks among investors following the book-building process; in cases of oversubscription, requests are partially fulfilled, thereby reducing the actual size of the position in relation to the requested volume.
Book-Building
The process of gathering and analyzing investor bids to determine the final offering price and the structure of demand; the outcome results in final pricing and the distribution of shares.
Lock-Up Period
A contractual period prohibiting insiders from selling shares after the IPO; following the end of the lock-up, increased supply may lead to a short-term decline in price.
Price Range
A preliminary corridor of the offering price within which underwriters and the issuer plan the final pricing based on demand.
DCF Analysis
A valuation method involving the discounting of projected cash flows and terminal value; sensitive to assumptions regarding growth rates and discount rates.
EV/EBITDA, P/E, P/S
Key comparative valuation multiples: enterprise value to operating income, price to earnings, and price to sales; applied considering industry specifics and the company's development stage.
Final Recommendation
If the goal is short-term speculation, prioritize the discipline of executing orders, stringent risk management, and monitoring news triggers. If the goal is long-term ownership, focus on the quality of the business, sustainable competitive advantages, sound valuation, and scenario analysis. In both approaches, results are determined not by one-off successful transactions, but by systematization, consistency, and risk control at every stage—from application to post-IPO support of the position.
