Alibaba Group Holding Ltd (NYSE:BABA) will soon debut on the New York Stock Exchange in grand, potentially IPO record-breaking fashion, and that has many investors wondering how they can get involved in the IPO in some manner, even if not directly. As Mia Saini reported on Bloomberg today, there are several different options available.
“So if you’re lucky enough to tap into the secondary markets, that’s a great avenue. I spoke to Brendan Ahern, he’s the managing director at Krane Fund Advisors, and he says some other ways include tapping the private wealth arm of some of the big underwriters that are doing the deal for Alibaba. Number two, he said actively managed mutual funds was the way to go, and ETF’s,” Saini said.
Otherwise, the options for getting a little piece of Alibaba Group Holding Ltd (NYSE:BABA) are limited. The company will not have any presence on some of the major indexes like the NASDAQ and S&P 500 due to various rules and restrictions. In the latter’s case, which also applies to the MSCI and FTSE 100 among other indexes, foreign companies like Alibaba Group Holding Ltd (NYSE:BABA) are not included in their benchmarks.
Another way would be to get involved in companies with major slices of Alibaba Group Holding Ltd (NYSE:BABA) ownership, including Yahoo! Inc. (NASDAQ:YHOO) and Japan’s Softbank Corp (USA) (OTCMKTS:SFTBF). However as Saini mentioned, the play on those companies was more noteworthy leading up to the IPO rather than following it, and they probably won’t provide the pop that could be found elsewhere.
Both Yahoo! Inc. (NASDAQ:YHOO) and Softbank Corp (USA) (OTCMKTS:SFTBF) have made major gains through the past month leading up to the Alibaba Group Holding Ltd (NYSE:BABA) IPO. Since August 12, both stocks are up about 19%, which in the case of Softbank Corp (USA) (OTCMKTS:SFTBF), has made its founder and CEO Masayoshi Son the richest person in Japan thanks to the stock’s surge, according to Bloomberg.
Alibaba Group Holding Ltd (NYSE:BABA) is expected to price its IPO tomorrow, with shares trading on the NYSE beginning Friday.
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