Robinhood, Chinese Stocks and Apple: Investments in the Spotlight

Robinhood Markets Inc.’s public debut was supposed to be a moment of triumph for democratized markets. Instead, it turned into a disappointment for the company.

Shares fell 8.4% below the initial public offering price, the worst debut on record among 51 U.S. firms that raised as much cash as Robinhood or more, according to data compiled by Bloomberg.

Key to the miss was lackluster demand from some of the very retail investors it’s counting on for growth. After initially setting aside an unusually large 35% of the offering for individual investors, Robinhood’s retail customers ended up buying only 20% to 25%, a person familiar with the matter said.

What’s next? “There’s a lot of negative sentiment and a ‘retail grudge’ from GME/AMC meme stock history,” said Vivian Tu, 27, an investor and creator of finance content on TikTok. “The way HOOD has traded today, especially against the overall market ticking higher, means that there are more Robinhood naysayers than previously thought.”

Investors got a rude reminder this week that the Chinese government plays by its own rules. Stocks plunged after a surprise decision to prohibit a large part of its booming education industry from making profits, raising foreign capital, or going public.

The rout… Continue reading at Bloomberg.com

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