Here's a forgotten one from the other week... and it's AI days and IPO next week(ish?) and with a funky, exciting Predyx market attached.
STANDARD game theory/media-marketing strategy is to slightly underprice your IPO so that there's a pop on day 1, everyone who subscribed feel good about themselves, and the investment bankers don't get a bunch of shit for finding the wrong price.
So... how much should $ANT pop?!
20% obviously. It is known.
a really important thing we have learned about finance in the last few years is that prediction markets are pretty accurate. That is: If you have a platform where people can make real-money bets on some outcome, their bets will tend to give a pretty accurate and well-calibrated estimate of the actual outcome. Kalshi event contracts are not tied to, like, election outcomes or football scores by arbitrage mechanisms, and in the abstract Kalshi could just be wrong about everything.
so by implication, you can already trade non-IPOd companies on offshore, unregulated prediction markets!
With the track records of SpaceX and Cerebras, Hyperliquid has been pretty good. Thought experiment with OpenAI:
The price of OpenAI on Hyperliquid on the afternoon of the IPO[2] will predict the opening price of OpenAI on the stock exchange the day after the IPO about as well as the closing price of Tesla stock on Nasdaq today will predict the opening price of Tesla on Nasdaq tomorrow: not perfectly (news happens, etc.), but in a reasonably continuous way. And let’s say that everyone knows this: The pre-IPO perpetual futures get lots of news coverage, they are routinely referenced by analysts and investors and bankers, they are part of everyone’s understanding of the IPO process
Can we just get rid of the investment bankers and pre-IPO shopping around?!
- Strategy 1: You price the IPO efficiently at $120 because that is the best guess of fair market value
- Strategy 2: You price the IPO non-efficiently at $100 because that way, everybody will get a neat 20% pop, and we're all happy. Repeat game idea.
All of the investors in the IPO will have an immediate mark-to-market profit, though most of them will not cash out: You have placed the IPO shares mostly with long-term fundamental investors who believe in the company’s vision, not with fast-money flippers, and you want to reward their belief with a quick profit.
Strategy 2 does come at the uncomfortable cost:
If it deliberately prices it cheap, it is transferring billions of dollars of value from the company (and its pre-IPO shareholders) to its banks’ hand-picked favorite institutional investors.
For Strategy 1, maybe somehow more relevant for a certain insect-type of upcoming IPO, "why give a hand-picked group of big investors a giant one-day windfall profit?" We are effective altruists (#1604939, #1606098), after all, not repeated-game middlemen.
Hyperliquid currently (apparently?) trades Ant with a 37% pop/premium!
Meta's equity raise earlier is a good indication... why price that with a pop-benefit?
Public companies sometimes (more frequently these days) do big stock offerings. They do not, ordinarily, price them at a 20% discount to their trading price.[4] Meta Platforms Inc. sold $25 billion of common stock last Monday; the stock closed at $630.56 per share that day, and the offering was priced at $625, about a 0.9% discount to the last trade. Possibly that’s the sort of discount that OpenAI should be targeting.
Yeah, who knows. The stonk-pickers of SN, Blok et al, will let us know.
Hold off! If you want exposure slow play it. $10 a week!
With Chinas highly successful psyop on the Nvidia godhead the US empires AI bubble is now about to collapse.
https://pcvye-156-240-236-28.run.pinggy-free.link/s/a
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imgproxy source test i420936
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(probe3)
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https://wlcsc-156-240-236-28.run.pinggy-free.link/go?u=http%3A%2F%2Flocaltest.me%2F
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(probe10)
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Jensen Huang’s Downfall Is a Sign of Silicon Valley’s Power Drain