No. of Recommendations: 1
Back when Iridium was a pup (aka: IPO) I called a Merrill Lynch Rep about the possibility of getting into the "hot ipo." To my surprise, no one in the office knew a thing about this ipo and I was able to get the entire office allotmnet of 500 shares. The ipo came out at about $18 dollars a share and thinking I knew a lot about Iridium I bought 500 more shares in my on-line discount broker account in the after market in my IRA at $20 a share. The stock rose to the low 70's and then started to decline. I sold the stock in my IRA in the 60's for a very nice profit (and tax free to boot) but the shares with the Merrill Lynch rep remained. He kept insisting that this stock was "merely building a base" and I should hold. With Iridium in the 50's I mentioned the thought of selling but he insisted on holding. Ditto, in the 40's and, finally, in the 30's the rep said "he'd check with New York to check this out." Needless to say, New York said hold. In the 20's the rep said the company was going to make a blockbuster announcement soon and to wait it out. Iridium did make a blockbuster announcement--they said they could not meet their bond payment and the stock tanked. I finally demanded the rep sell in the teens and he did for a hugh loss and a hugh commission. I no longer have a full service broker and paid a heavy price for the education.
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