[cududa]

Except that it's almost tripled in price?

[will_pseudonym]

Yes, but before it tripled in price, it actually lost almost half its value.

https://en.wikipedia.org/wiki/Initial_public_offering_of_Fac...

[MichaelGG]

So buy at IPO with options? In FB's example that'd have performed particularly well eh?

[chollida1]

>So buy at IPO with options? In FB's example that'd have performed particularly well eh?

There are no Options trading on IPO's. Typically options start trading 3 months after an IPO.

[MichaelGG]

Oh, interesting. I looked up recent IPOs on Nasdaq and ones from last month have options now. First Data (FDC) has been trading only 3 weeks and has options. But really low volume and ridiculous spreads. RACE has been trading only 3 weeks for less time and has more options. Perhaps they are exceptional due to their size?

Not that this would help with FB a whole lot since it'd have dropped a fair amount by the time you could buy options.

[jonknee]

The rules aren't based on time, but basically on diversity of shareholders (there need to be a lot of shareholders and a lot of shares outstanding) which makes sense.

You need 7m publicly held shares outstanding (many IPOs don't do this, a lot of shares are controlled by underwriters and insiders who can't sell at the IPO) at least 2,000 shareholders and some minimum trade volume. There's a minimum share price too, but that doesn't effect IPOs.

[MichaelGG]

Do you know where I can get the official docs on how options are controlled?