Beginner's Guide: How to participate in new stock offerings? Remember these 5 key points.

What are the benefits of participating in an IPO?

IPO, short for 'Initial Public Offering,' refers to the process in which a company sells shares to the public for the first time, transforming from a private company to a public listed company. Generally, IPO is one of the methods for companies to raise funds, expand business, or enhance brand visibility.

Potential high returns

The IPO market is heating up again, attracting widespread attention. In order to go public smoothly, most companies are willing to issue at a discount, creating arbitrage opportunities for subscribing to new shares; if the company performs well, the stock price may soar rapidly, giving investors the opportunity to earn substantial profits in the short term. However, it is also important to note that IPO investments come with risks, such as high market volatility, uncertain company performance, etc., so it is necessary to do thorough research before making a decision to invest.

Participate in emerging companies with long-term appreciation potential.

If investors can hold the stocks of potential growth companies early and keep them open, as long as the company continues to grow after listing, they can easily receive dividends (assuming the company pays dividends) and achieve long-term asset appreciation effects!

How to participate in an IPO?

Key dates to understand for new stock IPOs

When a company is listed on the Hong Kong Stock Exchange, as an investor, it is important to pay attention to the following 5 key dates:

1. Subscription Period: Generally lasts 3 to 4 days from the start of the subscription date to the subscription deadline. If you want to subscribe to new shares, please participate during the subscription period. The prospectus of the company intending to go public will specify the listing date.

2. Pricing Date: After the end of the new stock subscription, the final issue price is jointly determined by the company to be listed and the underwriter. The pricing date is generally the new stock subscription deadline or the next trading day after the deadline.

3. Announcement of Winning Shares Date: On the trading day before the new stock listing date, the listed company will release a notice of new stock distribution.

4. Grey Market Trading Day: The day before the new stock is listed, from 16:15 to 18:30, investors can trade the upcoming new stock through OTC trading.

5. New Stock Listing Day: The day the new stock is listed is its first day on the market.

How to check for recent new stocks open for subscription?

Through Futubull app's New Stock Center, you can easily access the latest subscription lists and upcoming grey market stocks. You can also check the performance of listed stocks and see which companies have submitted applications for listing hearing (upcoming IPOs).

In addition to Maoge Ping, the companies rumored to go public in December are:

Chow Tai Fook: Chow Tai Fook is a leading and rapidly growing jewelry company in China, providing high-quality and stylish jewelry products through the company's offline stores and online sales channels.

Hezhong New Energy: Nezha Autos, established in 2014, aims to become a global leader in new energy vehicles. Through continuous innovation and precise product positioning, the company has become a leading smart electric vehicle brand in China. Currently, it has launched 5 smart electric vehicles, and the delivery volume has rapidly increased from 64,230 units in 2021 to 124,189 units in 2023.

Brainsight Aurora Medical: Established in 2012, Brainsight Aurora Medical's product pipeline covers a wide range of cognitive impairments caused by vascular diseases, neurodegenerative diseases, mental disorders, and child development defects.

Ordinary Subscription vs. Financing Subscription, how to choose?

You can choose the most suitable and cost-effective subscription method according to your investment needs.

Want to increase your chances of winning? Bank financing subscription.

When a new stock is in high demand and you are bullish on its prospects, and you want to increase your chances of winning, you can choose bank financing subscription (warrant subscription).

Futu offers two financing options, Futu Financing and Bank Financing, which can be stacked. Futu Financing is a financing limit based on the value of pledged account assets, with an annual interest rate of 6.8%; Bank Financing can waive financing interest, with leverage of up to 100 times.

The higher the leverage ratio, the higher the chance of winning the lottery, but not all new stocks will rise after listing, so the risk is relatively higher.

Want to save subscription costs: Ordinary subscription

Ordinary subscription means subscribing only with cash in the account or Futu financing for IPOs.

Currently, through Futu for ordinary subscriptions, especially pure cash subscriptions, not only can you avoid financing interest costs, but also avoid subscription fees, making it the lowest-cost way to participate in IPOs.

In addition, Futu also supports zero-cost subscriptions. If there is temporarily no cash in the account, you can also pledge holding positions of stocks to obtain financing quotas for subscribing to new shares.

*Super high leverage only applies to specific new shares. Although high leverage may bring high returns, it also comes with certain risks. Please consider your own risk tolerance and investment objectives, and ensure you maintain sufficient assets to withstand market fluctuations. Zero-interest new share subscriptions are limited to bank borrowings. The actual borrowing interest rates for Futu borrowings related to bank borrowings are subject to the display on the subscription page. Zero fees refer to zero subscription fees for cash subscriptions in ordinary subscriptions and/or Futu borrowings.