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Robinhood typically allows our customers to place limit orders to purchase shares of IPOs on their opening day around 8:00 AM ET. We’ll send your order to our execution venue the morning of the IPO. You won't have to worry about paying more than you want because your order won't execute above your limit price.
How do I request IPO shares?
Once you have access to IPO Access, you can request IPO shares by following these steps:
How is a COB different from a standard trade made on Robinhood?
A conditional offer to buy (COB) is similar to a "buy order,” except the COB remains pending and does not become an active order until the IPO is priced and set for the initial public offering. You can edit or cancel your COB until the end of the confirmation window, after final pricing.
What is a confirmation window for an IPO and why is it important?
We display this date and time for you on the IPO share’s stock detail page in the app. You’re able to enter, edit, or cancel your request for IPO shares up until this time; however, once this time has passed, the request is locked until allocation is complete (which is typically mid-morning on the list date for the IPO).
How many shares can I get?
We work with the underwriter to receive a limited number of shares. We use the number of shares we receive, customer demand, and other factors to determine how many shares you'll get. You may get the full number of shares you requested, a partial amount, or none at all.
Disclosures
IPOs can be risky and speculative investments, and may not be appropriate for every investor. Learn more.
What is a pre-IPO order on Robinhood?
In May, Robinhood launched pre-IPO orders on certain stocks. The segment of stocks that have available pre-IPO orders is small, and it basically allows investors to schedule the purchase of a fresh IPO as soon as it hits the market.
To buy pre-IPO on Robinhood, you have to use a limit order
As a way to protect investors from the inherent volatility associated with brand-new IPO stock, Robinhood only executes pre-IPO orders as limit orders.
When can you make a pre-IPO order on Robinhood?
When Robinhood says "pre-IPO," it means just before the stock hits the public market. Usually, retail investors gain access to a stock a few hours after the market open on the day of the stock's debut.
Robinhood provides an estimated stock price
Robinhood takes its stock price estimation straight from the company's SEC filings. Companies can—and often do—change the stock price from the public preliminary filings. It's a risk that investors using Robinhood's pre-IPO orders must take.
When will Robinhood execute your pre-IPO order?
As long as the stock's market value is within your order's limit, Robinhood will execute your pre-IPO order once the company's stock hits the market. This can be as much as hours after market open on the day of the stock's debut.
Robinhood's pre-IPO orders are not the same as pre-IPO stock
Robinhood makes sure to clarify that this type of pre-IPO order is much different than a pre-IPO stock.
How long can you sell IPO shares?
We won't prevent you from selling shares you get through the IPO Access program. However, if you sell IPO shares within 30 days of the IPO, it's considered "flipping" and you'll be restricted from participating in IPOs for 60 days. Issuing companies and their underwriters often try to avoid IPO stock flipping.
How long does the IPO process last?
This "quiet period" usually lasts through the IPO process and ends 25 days after the IPO list date. During this time, the company can't release information not found in their S-1 filing. Confirmation period.
What is a flipping IPO?
Initial public offering (IPO) An Initial Public Offering (IPO) is one way for a private company to become a public company. Once a company is public, the general public can buy their stock.
Is options trading risky?
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Customers must read and understand the Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Supporting documentation for any claims, if applicable, will be furnished upon request.
How long do options last?
Exchanges decide when they will start making options available. Options are not available for at least three business days after a company goes public. Sometimes, it takes much longer (30 - 60 days) before a stock is eligible for options. Some stats exchanges look at when making that decision include: 1 Number of outstanding shares 2 Number of shareholders 3 Trading volume 4 Stock price
Can you buy fractional shares on Robinhood?
Robinhood allows investors to purchase fractional shares, which lowers the barrier to the stock market. While you can also buy IPO stocks on Robinhood if you want to make an early move in a newly public company, certain rules apply. Article continues below advertisement.
What is an IPO?
An IPO involves a private company selling its shares to outside investors. Also, the stock is listed on a public exchange. Companies use IPOs to raise money to fund their expansion, marketing, and other needs. Article continues below advertisement.
What happens when a company goes public?
The company going public will work with the underwriters to set the IPO price for the stock. The underwriting banks will use the IPO price to sell the company’s shares to investors just before the stock hits the public exchange. IPO underwriting banks sell shares in bulk to accredited large institutional investors.
How to buy pre-IPO stocks?
Buy Pre-IPO Stocks Directly From Companies 1 Contact banks, non-banking financial institutions, and accounting firms. Find out if they know of any private companies that are planning to issue pre-IPO stocks. 2 Attend startup pitch events and competitions and look for promising companies that you can invest in. Attending these events is also a shrewd way to build connections with seasoned investors and industry insiders. 3 Watch the news. Set up email alerts to find out about companies that are in need of investment and intend to go public. Contact them directly and ask them whether they are willing to offer pre-IPO stocks. 4 Register with crowdfunding platforms like AngelList, OurCrowd, and FundersClub, which allow you to invest directly in startup companies. 5 Register with stock tokenization platforms like tZero, which converts pre-IPO stocks into blockchain-based tokens. You can trade these for cash any time you want.
What is pre IPO stock?
Most pre-IPO stocks are sold in one of three ways. Angel investors or Venture Capital Firms who provide initial financing often acquire large blocks of shares. Pre-IPO placements occur when IPO underwriters make stocks available at a discount to selected investors before an IPO.
What is a pre IPO?
Investors must meet the SEC’s revised accredited investor criteria. Pre-IPO is a European broker operated by French firm Invest Securities. They offer placements in selected pre-IPO companies for as little as 2,500 euros. SecFi specializes in helping employees of private companies sell their stock options.
What is pre IPO placement?
Pre-IPO placements occur when IPO underwriters make stocks available at a discount to selected investors before an IPO. These typically happen immediately before the IPO. Stock options are sometimes provided to employees, who may resell their shares, subject to restrictions.
Robinhood wants to democratize IPO investing
Robinhood’s IPO Access aims to democratize IPOs so that even amateurs can make money on new company IPOs. “With IPO Access, everyday investors at Robinhood will have the chance to get in at the IPO price,” states the Robinhood blog.
Investors are using IPO Access to buy Robinhood stock
In an interesting twist, the access to purchasing pre-IPO shares through Robinhood has benefitted retail investors looking to buy Robinhood shares before its IPO on Jul. 29.
How can you buy pre-IPO shares on Robinhood?
Buying pre-IPO shares on the Robinhood app can be done in three steps through its IPO Access option.
