Last week’s initial public offering (IPO) of Twitter (TWTR) went off with a big bang as would-be buyers at the $26.00 IPO price overwhelmed the subscription by as much as 30 times even though the $26 price was already quite expensive.
As a result, TWTR started trading at $45.10 and went to a high of $50.09. However, since last Thursday, TWTR has traded as low as $39.40, a 21% decline from its weekly high. Hooray for those who could get stock at the IPO price and pity the persons who paid the highest prices with the big losses.
The Twitter IPO is still the buzz as lovers and haters of the stock are chiming in with strong buy or sell opinions. Some highly respected investment experts believe TWTR is really only worth $18.00 a share!
I didn’t get any allocation, but I do own some Twitter stock (indirectly) at a price cheaper than the $26 IPO price.
How??? We have been investing in FirstHand Technology Value Fund (SVVC) for years. SVVC is a closed-end mutual fund that is traded like a stock and that invests in “later stage” technology companies before they go public. As such, they are in early when the stock of these “high flyers” are still developing. SVVC focuses on investing in promising “venture capital stage” technology and biotechnology companies. Even before Twitter’s IPO, SVVC already owned 194,000 preferred shares and 812,200 common shares of Twitter. And SVVC is selling at a 21% discount to its reported Net Asset Value (NAV). You might consider buying some SVVC in your Aggressive or Growth portfolio. Hold it for a long time.
While the U.S. Stock Market has traded this week in a narrow range, our Fun Stocks Index continues to set performance records (up 586.82% since January 1, 2009 and up 66.67% year-to-date).
We have no changes to our TSOA Freedom Portfolio Asset Allocation for Retirement Accounts this week.
Midweek Stock Market Report – November 13, 2013