Welcome to Better Have My Money, my Monday night newsletter about stocks, feelings and how to invest.
Tonight is a glorious evening for Met Ball fashions — Ezra Miller’s face of eyes! Janelle Monáe’s blinking eye! Kacey Musgraves as Barbie! All of Gaga’s outfits! Truly a feast for the soul.
And I enjoyed the fashuns of an invite-only event that still costs $35,000 for a ticket even more after my stocks recovered after the market plunged this morning.
“Stock market is gonna be down today if there was anything you wanted to buy,” I texted my boyfriend at 9.32am, just two mins after the market opened.
Yes, this is how I sext.
Pre-market I was down 3% overall, just a sea of red on my Robinhood app. I did a quick google and realized the president had threatened tariffs against China.
OK, this happens, no biggie — but, it can be a nice moment if you want to buy anything.
Confusing term of the week: “pre-market” — Kind of like a presale, it’s usually marked as between 8-9:30am ET every day. Market activity is allowed but there’s some limitations on who can buy and how much.
Right now I just feel like a very interested potential buyer. My tax return has just appeared in my account, and I’m trying to figure out what fun silly spring thing I want to spend it on, like treating yourself to a pair of new sandals (Maybe I should look at stock in Deckers Outdoor Corp (DECK), aka owner of Tevas!!!)
So far 2019 has seen a bonanza of IPOs (initial public offerings) lately and the one I’ve kept the keenest eye on is Beyond Meat (BYND). They make “plant-based meat” as they call it, basically a non-gross veggie burger.
After reading about how 1,000,000 plant and animal species are now at risk of extinction thanks to the ramifications of man-made climate change, and then seeing this NY Times interactive about how to eat a climate change-friendly diet, fake meat seems like a pretty clear step towards the future.
On its opening day last Thursday it jumped 163%, the biggest IPO of the year.
A very dear pal of mine who has never bought or owned shares before texted me the other day that she was attempting to buy a share of Beyond Meat, “as they are $60 which is in my price range.”
The fact that she was even texting me about it made me realize that the hype around the company was crazy — which directly impacts the stock price. And it made me pause.
So should you buy a stock right when it goes public? Statistically… no, according to all the investing experts I’ve read.
More than anything, it’s turbulent af at the beginning. Usually stocks drop down in their second week of trading, and often drop again a few months in. Buying in the first few days of the IPO can be a way to make good money, and also a good way to lose it.
Lyft (LYFT), aka the ride-sharing app that is not Uber, was down in its first four weeks of trading, then jumped 9% last week. It’s still down 30% from the IPO. Pinterest (PINS) was up 44% in its first 10 days, then is now up around 23%.
Levi Strauss (LEVI), yes, as in the jeans is up 2% since it IPOed a few weeks ago and Zoom (ZM), which you probably recognize as a video conferencing platform is up 20% since its public debut.
All the advice about whether to invest early in an IPO involves doing a lot of research: reading the prospectus, studying the financials. If that is beyond you (it is beyond me, even for Beyond Meat), then maybe it’s worth riding out the initial few weeks or months of an IPO to let the stock settle in a bit more and understand what it’s worth.
Having said all this, if what you’re looking for is a cheeky spring purchase in the form of stock rather than an expensive outfit you’ll wear once — or in the case of Gaga, four outfits she’ll wear once — then hey, maybe give a freshly public stock a whirl. A bit of drama can be fun, if you’re expecting it.
And if you do just want to buy yourself something pretty, may I suggest giving your money to The Milaya Project, where South Sudanese women are keeping tradition alive by hand-embroidering sheets and pillowcases in a remote refugee camp. You can purchase their gorgeous bold embroidered designs on Kickstarter.
Have a bold week,
Better Have My Money is on Twitter @bhavemymoney, so please tweet nice things (aka the link to our sign up page) and tag us. Got a mate who is loves drama? Forward this onto them and tell them to subscribe. If you sign up to Acorns, use my sign up code to join and we both get $5.
As always, if you've got any questions about stocks, this is a shame free zone. Just reply and ask away.