It was a bloodshed for the recent IPO (Accordia Golf Trust) on its opening day of trading.
The unit opened at $0.87, compared to the offer
price of $0.97. It was an immediate 10.3% decline in capital for the unfortunate IPO investors. The unit went down to as low as $0.80 before recovering to $0.85 at first day close and 12.4% lower than the offer price of $0.97.
Currently, Accordia Golf Trust was at $0.825 (last Friday's close) and about 15% below its IPO offer price.
The timing for IPOs is just not right now due to uncertainties caused by Ukraine and Gaza Strip crises, Argentina default, Ebola outbreak in Africa, looming increase in interest rates, etc.
Accordia Golf Trust was only 0.7 times subscribed and because of poor investor sentiment, I expect Ireit Global highly to be the same.
One good indicator is my broker has contacted me again asking me to subscribe to Ireit Global units. And of course I declined again.
Showing posts with label Accordia Golf Trust. Show all posts
Showing posts with label Accordia Golf Trust. Show all posts
Saturday, 9 August 2014
Saturday, 26 July 2014
IPO - Accordia Golf Trust
Out of the blue my broker contacted me and asked whether I would like to subscribed some IPO shares of Accordia Golf Trust.
I was quite surprised because my broker has never done that in the past and normally he never bothered with small investors like myself. This was the first alarm bell.
I thought then that maybe the response for this particular IPO was just too lukewarm and they have many unsubscribed units.
I asked how many lots I can get and was told as many as I wished. Second alarm bell rang and I declined and told him that I have no money to purchase.
The outcome was really true that the public offer was undersubscribed. It was just approximately 0.7 times subscribed and it was such a long time since an IPO was undersubscribed.
The most likely scenario is Accordia Golf Trust will be a submarine when it starts trading.
I think many people will probably get burnt, especially those who applied 50-100 lots and thinking that they will be allocated only a few lots.
I was quite surprised because my broker has never done that in the past and normally he never bothered with small investors like myself. This was the first alarm bell.
I thought then that maybe the response for this particular IPO was just too lukewarm and they have many unsubscribed units.
I asked how many lots I can get and was told as many as I wished. Second alarm bell rang and I declined and told him that I have no money to purchase.
The outcome was really true that the public offer was undersubscribed. It was just approximately 0.7 times subscribed and it was such a long time since an IPO was undersubscribed.
The most likely scenario is Accordia Golf Trust will be a submarine when it starts trading.
I think many people will probably get burnt, especially those who applied 50-100 lots and thinking that they will be allocated only a few lots.
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