Initial Public Offerings

Visualize What Investing $100 Early In Stocks Would Be Worth Today

There’s a lot of power in being first. And when it comes to Initial Public Offerings, or IPOs, it pays to be among one of the earliest investors.

Q4 hedge fund letters, conference, scoops etc

But we wanted to understand how much it would pay, so we ran an experiment. Imagine you could go back in time and invest $100 into a handful of great companies when they initially went public. What would your investments be worth today?

Initial Public Offerings

Let’s start with how we crunched the numbers. We wanted to compare apples to apples, so we made a couple key assumptions. First, we assumed our hypothetical investment of $100 at each IPO would stay with the underlying asset for the long term, but any dividends would be taken out as cash and not reinvested. Then, we determined the present-day value of the investment through the ups and downs of stock splits, mergers and acquisitions. You can read more about our sources and methodology here. In short, you put $100 in at the IPO, and let it ride.

So it pays to be among the earliest investors, but how do you know what to invest in?  Some IPOs skyrocket in value only to plummet in the following years. Other IPOs take a long time to get off the ground.

Correction March 4th, 2019: A previous version of this article compared an Investment of $100 in BTC vs IPOs. In order to avoid confusion we are now only comparing investments into IPOs.

Article by HowMuch


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