Robinhood Markets Inc.’s initial public offering is stirring interest among individual investors.
The trading app, which now has 22.5 million funded accounts and fueled a number of meme stock rallies in the past year, is urging its own customers to invest. The company plans to sell its users up to 35% of its IPO shares, or up to 18.3 million shares. This past Saturday, the company’s executives held a virtual roadshow specifically for mainstream investors.
There’s plenty to know if you’re watching this hotly anticipated IPO, which will be a test of whether individual investors want to stay on the sidelines or jump into this type of investing.
What’s unique about Robinhood’s IPO?
Typically, nearly all shares of a company aren’t available to individual investors before they start trading and the bulk of shares in an initial public offering are given to institutions. Recently, firms such as Robinhood and SoFi have started to offer IPOs at offering price to their customers as part of their mission to make markets accessible.
The offering price of an IPO is the price at which a company like Robinhood makes its shares available to investors before trading. The opening price is the price at which a company begins trading—which could immediately jump, stagnate or plummet, depending on how the market values the company.
