7 ms·

Anybody who thinks that IPO pricing is done by DCF.....

• timr 13y ago
  It isn't, but it's a convenient model that holds true on average. What people actually do is say: "oh, crap...I can't make money in fixed-income securities. I guess I'll dump my retirement in stocks instead." This flood of money eventually makes its way to the riskiest stocks and props up high valuations.
  • acchow 13y ago
    > This flood of money eventually makes its way to the riskiest stocks Citation needed.
    • timr 13y ago
      The same way it makes it to every other stock. People buy them, looking for returns.