A quick update. I was awarded shares of Robinhood! In many ways, this renewed my appreciation for capitalism, the markets and the United States of America. As I’ve mentioned in previous posts, I’ve tried unsuccessfully for years to get in on IPO offerings (most recently Beyond Meat) and have never been awarded shares. I always assumed this was because I’m a very small fish in a Fidelity pond of large sharks and there was never any reason to offer IPO shares to small retail investors like me. So I was naturally intrigued when Robinhood said they would randomly allot 20-35% of their IPO shares to Robinhood customers. Why not give it a try? I wanted to see if if was actually possible to be awarded IPO shares.
Turns out, it is. I opened a Robinhood account with a small amount of money, as more of an investment experiment than a real investment opportunity, and was awarded shares at the IPO listing price of $38/share.
The problem is the shares traded down 8% on the first day.
“There’s the reason you were awarded shares,” a friend said. “Nobody wanted them.”
That may be true. But I think Robinhood has a semi-bright future. After the GameStop debacle fades and the regulatory missteps recede, one of the big brokerage houses will likely make an offer to buy the company because of their fast growing userbase of young, tech savvy investors. Sure, I would’ve liked to experience the typical 50-80% bounce so many IPO shares experience on the first day of trading. But I’m happy to let this experiment play out over the next 5-10 years and see where shares take me.
Note: The one thing I do love about the app is the way your portfolio’s total is updated. Every few seconds, my portfolio’s total updates in an old school cash register style where the numbers run up or down based on my stocks’ movement. It’s addicting. I find myself staring at the updates and I can see why anyone under 25 would too. It’s like watching your high score on a video game continue to rise. I wonder if this is what Jeff Bezos does when there’s nothing good to stream on Amazon Prime? Seems like a really good use of time.
