S&P500 at record highs - time to stay in or pull out?

[Nicetobenice]

Puzzles said:

I m not really sure what people are expecting as it can t go to the moon from a near 2tn valuation

That's exactly what I was thinking.

So many questions about this offering.
Then you look at the price/value and wonder why you'd bother anyway.

[zedmtrappe]

BobToc said:

I do think there s a phenomenal amount of retail interest though.

This !

And I reckon a lot of it is from a generation who have only ever known markets going up, absolutely no idea about P/E ratios, fundamentals all that boring stuff * ... they would refer to themselves as traders, but gamblers with the mindset that they just can't lose maybe a more accurate description to my 55 year old jaded self!

Combine that with the cult of personality Musk and there you have it.

I was charting to my mate who's 19 year old electrical apprentice son ( who is also a 'trader') was telling him about the money that he was going to make from the SpaceX IPO .... tells you all you need to know.

• not that any of that is even a consideration these days ?

[g4ry13]

Panamax said:

g4ry13 said:

All the money gets made by the insiders and the peasants get allocated the carcass.

By what mechanism are you suggesting that happens?

Institutions such as Sequoia Capital, Scottish Mortgage were able to invest and help with the funding before there was ever talk of an IPO. They obviously acquired their equity at a much lower price.

The underwriting group gets to divvy up the shares to their mates. If there's a lot of interest from their mates, a small number of shares get distributed to retail. We saw this happen with Royal Mail when they restricted the amount we could buy.

[DaveA8]

Phooey said:

BobToc said:

At the risk of sounding like a talking head I do think there s a phenomenal amount of retail interest though.

Welcome to the casino

Space-X Price-to-Sales 100x
Nasdaq P/S 7x
S&P 500 P/S 3.5x

While there may be a fundamental logic in those numbers, the only thing that matters in the short and medium term is the price action even if that offends so called buy and hold investors. Personally I won't trade it as IPO's are a specialist subset of SIPs and either intraday or as a swing there are a lot of people who earn a living doing it. Another poster mentioned lots of IPO's never trade above their first day price which is I understand true, a lot give up much of their price and a few go onto to exceptional gains. The real issue with an IPO is that there is no history of price discovery, you can't know where it's been, to use a Peter Lynchism "it might go up, it might go down or it might stay where it is"
Trade those set ups over the longer term and the odds favour the poor house rather then the rich house.

[Panamax]

g4ry13 said:

The underwriting group gets to divvy up the shares to their mates.

Do you not accept that underwriters are "at risk" themselves and it makes sense to lay off some of that risk?

Get the initial offer price wrong and it can all go horribly pear-shaped.

[p1stonhead]

Panamax said:

g4ry13 said:

The underwriting group gets to divvy up the shares to their mates.

Do you not accept that underwriters are "at risk" themselves and it makes sense to lay off some of that risk?

Get the initial offer price wrong and it can all go horribly pear-shaped.

It is wrong though. Just look at the insane valuation.

[BobToc]

From the underwriters’ perspective they want it to trade at a modest premium on the day. We ll find out soon enough.

[NowWatchThisDrive]

Panamax said:

g4ry13 said:

The underwriting group gets to divvy up the shares to their mates.

Do you not accept that underwriters are "at risk" themselves and it makes sense to lay off some of that risk?

Get the initial offer price wrong and it can all go horribly pear-shaped.

Though in this case the company has set the price upfront themselves to guarantee a pop. So the pricing risk the underwriters would have with a conventional bookbuild is eliminated.

[BobToc]

Yeah, IPO fees aren’t really about price risk any more. They’re not underwriting in the same way they would be on a bought deal or a block, and we’re a long long way from the BP privatisation.

[BobToc]

I would say IPOs were the stock pops 50% or whatever are a not a great day on the office…

[gotoPzero]

A single tweet just spiked the S&P 1.3% LOL.

[Esquire]

gotoPzero said:

A single tweet just spiked the S&P 1.3% LOL.

By way of an update it's now 3.4% but by the close of business that could be 3.4% down when Iran tell the orange baby to do one !

[Nicetobenice]

Esquire said:

gotoPzero said:

A single tweet just spiked the S&P 1.3% LOL.

By way of an update it's now 3.4% but by the close of business that could be 3.4% down when Iran tell the orange baby to do one !

At what stage do people start calling the market "broken"?

[AyBee]

Nicetobenice said:

Esquire said:

gotoPzero said:

A single tweet just spiked the S&P 1.3% LOL.

By way of an update it's now 3.4% but by the close of business that could be 3.4% down when Iran tell the orange baby to do one !

At what stage do people start calling the market "broken"?

It's already broken when Trumpty Dumpty can make it move so much just by tweeting. Failed businessman who is now a multi-billionaire from insider trading.

[p1stonhead]

AyBee said:

Nicetobenice said:

Esquire said:

gotoPzero said:

A single tweet just spiked the S&P 1.3% LOL.

By way of an update it's now 3.4% but by the close of business that could be 3.4% down when Iran tell the orange baby to do one !

At what stage do people start calling the market "broken"?

It's already broken when Trumpty Dumpty can make it move so much just by tweeting. Failed businessman who is now a multi-billionaire from insider trading.

He and his cronies have literally discovered an infinite money glitch.

[Nicetobenice]

p1stonhead said:

He and his cronies have literally discovered an infinite money glitch.

It really does feel this way.

However it also seems incredible that it could just keep happening

[SturdyHSV]

Nicetobenice said:

It really does feel this way.

However it also seems incredible that it could just keep happening

The amount of money that flows through algorithmic buying / selling is enough to influence the market.

Algorithms don't get tired of reacting to the same headline over and over and get skeptical, they just keep doing the same thing every time.

[pingu393]

SturdyHSV said:

Nicetobenice said:

It really does feel this way.

However it also seems incredible that it could just keep happening

The amount of money that flows through algorithmic buying / selling is enough to influence the market.

Algorithms don't get tired of reacting to the same headline over and over and get skeptical, they just keep doing the same thing every time.

Nothing stopping anyone from riding the Trump wave, rather than standing on the shore complaining about the higher than usual tide.

I was up 12.5% in two months, and down 3% in two days. Luckily, I timed the market , and moved the money needed for a holiday at the peak. The rest can stay for the ride .

[Nicetobenice]

SturdyHSV said:

The amount of money that flows through algorithmic buying / selling is enough to influence the market.

Algorithms don't get tired of reacting to the same headline over and over and get skeptical, they just keep doing the same thing every time.

Do the algorithms pick up the headlines or does someone trigger them? (Genuine question as I don't know)

And Pingu - I agree some good returns to be made for those who know how to play the game.

[g4ry13]

Nicetobenice said:

SturdyHSV said:

The amount of money that flows through algorithmic buying / selling is enough to influence the market.

Algorithms don't get tired of reacting to the same headline over and over and get skeptical, they just keep doing the same thing every time.

Do the algorithms pick up the headlines or does someone trigger them? (Genuine question as I don't know)

And Pingu - I agree some good returns to be made for those who know how to play the game.

Yes, they are constantly scraping the data feeds. Potentially Twitter as well.

If you have a person doing it then you're too slow.