Investment king Warren Buffett said Friday that he will not buy Facebook shares when the company’s initial public offering launches May 18. But what about average investors who want to get in on the action? Might E*Trade be able to come to their rescue?
CNNMoney reported that the addition of E*Trade to the list of its IPO underwriters, now numbering 33 in total, may be aimed at giving the average investor a shot at participating in the activities of May 18.
According to CNNMoney, E*Trade brokerage-account holders can go to the online trading outfit’s IPO center and place conditional offers by revealing how many Facebook shares they would buy, and their maximum price per share.
Once the final price is set, which is scheduled to occur May 17, E*Trade’s portion of the IPO shares would be divided among its account-holders who committed to that price, as long as those account-holders have sufficient funds in their accounts and completed user profiles.
CNNMoney added that while E*Trade clients may not be able to purchase the number of shares they desire, this process at least gives them a chance to get a foot in the door.
E*Trade is not the only potential source of Facebook share, as CNNMoney pointed out that Fidelity and Charles Schwab can also offer the stock to their clients. However, IPOs are only available to Fidelity clients with a minimum of $500,000 in assets at the broker, who have made at least 36 trades during the past year, according to CNNMoney, while Schwab spokeswoman Alison Wertheim told CNNMoney:
We aren’t an underwriter, but we do periodically offer IPOs to our clients through arrangements we have with underwriters. It remains to be seen to what extent we’ll participate in the Facebook IPO.
Facebook shares are also included in funds from T. Rowe Price and GSV Capital, and exchange-traded fund the Global X Social Media Index will add the social network’s stock five days after its market debut, but Facebook shares obviously represent only a portion of those funds’ holdings, according to CNNMoney.
Readers: Are you looking to get your hands on Facebook shares May 18, and what steps have you taken?