The IPO market has been heating up lately as investors pile into riskier areas. Several high-profile private companies, particularly in the AI and crypto space, have debuted this year with strong first-day gains.
Software firm Figma (FIG) more than tripled, and stablecoin issuer Circle (CRCL) more than doubled in their debuts. Since then, Circle is up about 87%, while Figma is down 17%. Bullish (BLSH), which jumped more than 80% on the first day, is now down almost 35%.
It’s important to remember that not all IPOs are successful. Investing in smaller, lesser-known companies can be quite risky. While a few of these fledgling firms may become excellent long-term investments, others can lead to significant losses.
This post originally appeared at Zacks.