When investing in an IPO in Japan, you can apply for the book building before the listing and if you win the lottery, you can purchase the initial public offering stocks.
The purpose of an IPO is to raise funds from the financial market at large by taking the shares of an unlisted company public. When an unlisted company goes public, it attracts the attention of more investors. As a result, the company’s name recognition will increase and it will be able to recruit talented people.
The merit of an IPO is that you can expect a significant price increase. In general, IPOs are said to be profitable, but let’s take a look at past data to see if this is really true.
In 2017, 88 stocks went public. Eighty stocks saw their share price increase during the initial public offering, accounting for 90.9% of the total. The overall return was +110.27%. In 2018, 90 stocks went public. Eighty-one stocks saw their share price increase during their initial public offering, accounting for 90% of the total. The overall rate of return was +116.88%. In 2019, 82 stocks went initial public. 73 stocks saw their share price increase during initial public offering, accounting for 89% of the total.
The overall rate of return was +83.83%. In 2020, 93 stocks went public. 70 stocks saw their share price increase during their initial public offering, accounting for 75.3% of the total. The overall rate of return was +129.9%.
As you can see from these results, IPOs are almost always profitable as long as you pass the lottery. I have been applying for IPOs for about a year now, but I have only been selected once. The probability of winning is low, but it is worth it because you can aim for low risk and high return.
In Japan, you can apply for this service from the following securities companies.
- Nomura securities
- Monex securities
- Rakuten securities
- SBI securities
- SMBC Nikko securities
- Okasan Online securities
- Au Kabucom securities
- Matsui securities
- GMO CLICK securities
- Line securities
There are other securities companies that offer IPOs, but these are the main ones. SBI Securities will have the largest number of IPOs in 2020. There were 85 IPOs at SBI Securities. My recommendation is Nomura, Okasan Online securities. Because these two securities companies don’t need money until you win the IPO lottery? In addition, these two securities companies also handle a large number of IPOs. Other brokerage security companies a deposit before the IPO lottery. To open an account with one of these securities companies, you must live in Japan.
If you live in Japan, let’s try it!
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