Want a piece of Facebook? Get in line

Facebook may be the year's hottest stock issue -- but try getting a piece of it. Small investors will find the line long and hurdles high to get even a handful of shares.

And membership in Facebook's social network won't help, no matter how much you "like" the company.

Likely this coming Friday, Facebook will be putting out on the market in its initial public offering a huge 337 million shares, with the price expected to be between $28 and $35 a share.

At the midpoint of that range, the social network will be raising $10.6 billion from investors.

First in line are those with the big resources and long-term investment plans, such as insurance companies, pension funds and mutual funds. They will get the lion's share of the handout.

There will be a good chunk available to small investors -- though "small" is a relative term.

Retail brokers say requests for the shares are high, and they will mostly divvy up what they receive between their best customers.

At Fidelity, one of the largest US brokers, hot IPOs normally go to clients with half a million dollars in their accounts, or those who make at least 36 trades a year, according to a company agent.

But depending on how valued you are, a $250,000 account could be enough, she said.

"It's definitely not a first-come, first-serve basis," she told AFP, not wanting to be identified.

And even then, the broker won't promise even a minimum 100-share allocation.

"You could get the full amount (you request), or part of it, or none."

At TD Ameritrade, the hurdles are an account with at least $250,000, or 30 trades in the past three months.

In addition, said spokeswoman Beth Evegan, the client's general investment objectives and financial status can be considered. Brokers generally do not want someone like a pensioner who could would be hit hard by a trading loss to trade in risky stocks.

Even then, Evegan added: "We are expecting to receive an allocation... We do not know how many shares we will receive."

Other retail brokers have similar requirements for their clients. But for most, there is another catch: small investors who win the allocation lottery might find themselves unable to take advantage of an opening day spike in the share price.

Many retail brokers insist their clients hold onto the IPO shares for a fixed period rather than sell into a first-day rally. Fidelity sets a 15-day rule; for some, it is 30 days.

Analyst Rocco Pendola of The Street had words of encouragement for the little guys who cannot get a piece of the action.

"Let's face it: You have little chance of getting Facebook shares in the IPO," he wrote.

On the other hand, "You'll have plenty of time to hop on the bandwagon. This is a long-term, highly-sustainable and scalable business; it's a myth that Facebook is a fad or run by some green punk."

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • N. Korea fires missiles in anger at South-US military drills
    N. Korea fires missiles in anger at South-US military drills

    North Korea fired two short-range ballistic missiles into the sea and vowed "merciless" retaliation Monday as the US and South Korea kicked off joint military drills denounced by Pyongyang as recklessly confrontational. The annual exercises always trigger a surge in military tensions and warlike rhetoric on the divided peninsula, and analysts saw the North's missile tests as a prelude to a concerted campaign of sabre-rattling. "If there is a particularly sharp escalation, we could see the …

  • Couple married 67 years holds hands in final hours together
    Couple married 67 years holds hands in final hours together

    FRESNO, Calif. (AP) — After spending 67 years together as devoted husband and wife, there was no question how Floyd and Violet Hartwig would end their lives — together. …

  • Hijacked Indonesian vessel found in Davao
    Hijacked Indonesian vessel found in Davao

    An Indonesian cargo vessel that was hijacked a month ago in North Sulawesi, Indonesia has been found stuck in the waters off Mati, Davao Oriental, the Philippine Coast Guard (PCG) reported yesterday. PCG spokesperson Armand Balilo said the PCG- Southeastern Mindanao district was informed on Feb. 23 that the M/T Rehoboth was found aground off Barangay Cabuaya. Four personnel from the local PCG district office were sent to verify the report. The vessel was reportedly hijacked by …

  • 'Jihadi John' relatives under watch in Kuwait
    'Jihadi John' relatives under watch in Kuwait

    Kuwaiti authorities are closely monitoring several relatives of "Jihadi John" who live and work in the Gulf emirate where the Islamic State executioner was born, press reports said on Sunday. A number of relatives of Mohammed Emwazi, named as the militant who has beheaded at least five Western hostages, are working in Kuwait and like him hold British citizenship, Al-Qabas newspaper reported. "Security agencies have taken the necessary measures to monitor them round the clock," the paper said, …

  • Military steps up offensive vs BIFF, Abu Sayyaf
    Military steps up offensive vs BIFF, Abu Sayyaf

    Armed Forces of the Philippines (AFP) chief Gen. Gregorio Pio Catapang Jr. has ordered the sustained campaign against the Abu Sayyaf and the Bangsamoro Islamic Freedom Fighters (BIFF) following the successive offensives against the armed groups last week. A total of 24 Abu Sayyaf bandits and two soldiers were killed in recent clashes in Sulu last week. The Joint Task Group Sulu has received information that Abu Sayyaf leader Radulan Sahiron was wounded during one of the encounters but this is …

  • Militants want US Marines pulled out of Negros
    Militants want US Marines pulled out of Negros

    The militant group Bagong Alyansang Makabayan (Bayan) is calling for the pullout of US Marines who arrived in Sagay City, Negros Occidental last Wednesday to train Special Action Force (SAF) commandos and members of the allied forces. The SAF commandos and the allied forces will secure the Asia-Pacific Economic Cooperation (APEC) ministerial meeting in this city. Bayan-Negros secretary general Christian Tuayon said the US troops might violate the human rights of activists, especially those …

  • Interview: Australia says hunt for missing MH370 jet may be called off soon
    Interview: Australia says hunt for missing MH370 jet may be called off soon

    By Matt Siegel CANBERRA (Reuters) - The search for missing Malaysia Airlines Flight MH370 cannot go on forever, Australia's deputy prime minister said, and discussions are already under way between Australia, China and Malaysia as to whether to call off the hunt within weeks. No trace has been found of the Boeing 777 aircraft, which disappeared a year ago this week carrying 239 passengers and crew, in what has become one of the greatest mysteries in aviation history. The search of a rugged …

  • Binay backs house arrest for JPE, GMA
    Binay backs house arrest for JPE, GMA

    Vice President Jejomar Binay yesterday supported proposals to put Sen. Juan Ponce Enrile and former President now Pampanga Rep. Gloria Macapagal- Arroyo under house arrest. “Government prosecutors are opposing house arrest for… Enrile. Binay issued the statement after the 91-year-old Enrile was rushed to the Makati Medical Center on Thursday due to pneumonia. House arrest for him would be the compassionate thing to do,” he added. …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options