In the frenzy that surrounds a hot IPO, buyers will ignore any note of caution.

“Everyone else is going to get rich, why shouldn’t I?”  That’s the sound of FOMO – the Fear of Missing Out.   

And maybe the stock will rise, at least for a time. Buyers will walk tall. They will pity those who lacked their vision and savvy.

Still, it’s worth asking a question that, when the IPO fever breaks and prices fall, can lead others to feel JOMO – the Joy of Missing Out:
 

If the people who know a company best – management and their Wall Street advisors – think this is the time to sell, do they maybe, possibly, conceivably know something you don’t?  

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Barry Dunaway, CFA®
Director of Research
America First Investment Advisors, LLC
Omaha, Nebraska

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This post expresses the views of the author as of the date of publication. America First Investment Advisors has no obligation to update the information in it. Be aware that past performance is no indication of future performance, and that wherever there is the potential for profit there is also the possibility of loss.