Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Death Star IPO

What it is:

A Death Star IPO is a wildly successful IPO. The term is a reference to the Star Wars movies, in which Darth Vader's Death Star battle station could pulverize other planets with a single laser beam.

How it works (Example):

For example, let's say Company XYZ invents a cure for cancer and patents the invention. The company can change the world and make its owners fabulously wealthy, so investors are drooling over the company's upcoming $900 million IPO. The stock starts trading, and on its first day the share price triples. This is a Death Star IPO.

Luke, I'm your broker.

Why it Matters:

Death Star IPOs get a lot of anticipatory press, a lot of interest from investors and a lot of media coverage. They also tend to "explode" on the first day of trading and can influence the rest of the market.