Investors are understandably feeling jittery about the stock market after a rocky start to the year. Unfortunately, the recent doom-and-gloom commentary on financial markets has taken the focus off what was one of the best performing investment classes of 2015 – Initial Public Offerings. A popular myth is that IPOs are a risky investment strategy compared to buying stock in companies that are already trading. But looking at the numbers, the reality – in 2015 at least – is that IPOs delivered much higher gains than most blue-chips and market indices. According to analysis by OnMarket, the average return of the 93 companies that listed on the ASX in 2015 was 23 per cent by the year’s end. Compare that with the ASX All Ords, which lost 4.3 per cent in the same period and you have yourself an outperforming asset class. So-called ‘safe’ blue chips and large caps also fared badly: the ASX50 lost 1.3 per cent and household names like BHP Billiton and NAB were down 33 and 9 per cent, respectively, in 2015. Continue reading ...(VIEW LINK)
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