Quote:
Originally posted by boneprone
JESUS CHRIST..
The DOW is up over 10,000 today.
Yet im down..
Been down for a while now.
Everything i put my money in it goes to shit.
Stocks, the Yankees, the Blazers, you name it.
Im gunna dump a bunch of cash into the dreamworks IPO tomorrow..
Watch for that one to tank...
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I can see why you are having a problem. I wouldn't invest in IPOs. People get clouded by huge IPO successes like microsoft and mcdonalds but overall IPOs are a bad investment. Two university professors, Jay Ritter and Timothy Loughran documented the success of all the IPOs since 1970. here is what they found:
Average annual return for IPO stocks: 5%
Average annual return for comparable stocks: 12%
As a general rule, IPOs are overpriced.
Try real-estate. I agree with you that we are in a bubble but as long as you buy primary real-estate (not vaccation property), it shouldnt be effected much. And I gaurantee you if you hold it for 10 years, bubble or not you will make money. Look at it this way, if you have $150,000 in cash and you buy a townhouse, you can rent that townhouse for $100-$1500 a month. Tell me another investment, besides small business, that will pay you up to 10% per year in dividends and then appreciate.
A good investment, including index funds, will return an average yield of 10-12% a year. any investment that you think will make more than that is a going to be a big risk.
I got those IPO stats from Investing for Dummies by Eric Tyson. It way be embarresing to read on the airplane, but it is a good book.