Nine out of the 10 stocks that closed above the open on their IPO days were trading even higher by day 20, with a median gain of 7.8%. And although four of the six stocks that closed below their opens on IPO day also traded higher by day 20, most of these gains were more modest—the median increase was only 3.2%.
Overall, traders who bought this year's IPOs only if they closed “strong” on their first day of trading would have filtered out some of the worst performers over the next month.
There’s definitely plenty of action in the IPO market, but keeping tabs on the trading patterns of new issues can help traders keep some of that volatility in perspective.
And, of course, a historic pattern is no prediction of what's to come.
Today’s numbers (all times ET): GDP (8:30 a.m.), Corporate Profits (8:30 a.m.), Pending Home Sales Index (10 a.m.), EIA Natural Gas Report (10:30 a.m.).
Click here to log on to your account or learn more about E*TRADE's trading platforms, or follow the Company on Twitter, @ETRADE, for useful trading and investing insights.
Beyond Meat is now larger than 80 S&P 500 companies, but IPO euphoria might not last. 6/18/19.