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This is intended for me: a regular 30 yr old guy who works 9-5, and has a middle class income. Please describe well. I am nearly a complete noob. I know a little though. Also I am from Canada.

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With traditional U.S. IPOs, institutional investors typically received the majority of IPO shares. Most of the portion that retail gets is allocated to the preferred customers of the underwriters. Therefore, the odds of you getting any shares of a highly desirable IPO is small, even nil if the issue is oversubscribed.

Occasionally, a company goes public on its own rather than hiring an investment bank to take it public. With these, you have a much better chance at getting shares but they tend to be lower quality companies.

And then there's the issue of meeting your broker's eligibility requirements as well those of FINRA.

The short answer is that you need connections to participate in the good IPOs.

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  • The guiding principle in relation to IPOs is as follows: Never participate in an IPO that you are able to participate in.
    – Richard at NorgateData
    Commented Dec 22, 2020 at 7:46
  • By far and away your guiding principal is correct. However, it's not impossible to get involved in the IPO market if you have or can make some Full Service Broker connections. That's a tall order for the small investor today who trades at deep discount brokers who for the most part charge no commissions.
    – Bob Baerker
    Commented Dec 22, 2020 at 13:28
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You're in Canada, so it'll be difficult. And you're no one special to the investment firms that underwrite IPOs, so there's no reason for them to sell to you as opposed to their big customers.

Thus, your prospects are about as dim as a very deep and dark cave.

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  • Thanks for your reply. I would like to ask a follow up question: You mentioned that I am 'no one special' to the investment firms that underwrite these IPOs, and also 'big customers'. Who are these 'special' persons and 'big customers'? Can you please elaborate? And how can I become one? I am new to this.
    – Vineet Pande
    Commented Dec 22, 2020 at 3:45
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    Preferential customers are clients with large accounts who have done a lot of business with the brokers who work at firms who are members of the underwriting syndicate. In a sense. shares in the good IPOs are a reward for past business.
    – Bob Baerker
    Commented Dec 22, 2020 at 3:58
  • In addition, look up Accredited Investors. From a regular 9-to-5 job it may be hard to get to that spot without some hustle but that is another 'special' way you can get access to pre-IPO/IPO stocks.
    – perennial_noob
    Commented Aug 4, 2021 at 21:07

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