Should You Invest in an IPO?

Investors are people. They like novelty; get excited by something new, especially if it holds the promise of making them a whole lot richer and provides bragging rights at their next cocktail party. Maybe that’s why amateur and professionals alike tend to lose their minds in bull markets, particularly when a hot initial public offering, or IPO, is offered to them by their broker. Is investing in an IPO the road to riches or a potential disaster for your portfolio?