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Market Overview

BATS Exchange Gets Its IPO Right The Second Time


BATS Global Markets Inc. (NASDAQ: BATS) shares debuted Friday and were recently trading $3.83 above its offering price. It's the company's second attempt to IPO its own stock, with the first culminating in an unmitigated disaster.

The March 23, 2012 IPO of BATS was brief, to say the least. It began trading at 11:14:18.436 a.m. with an initial price pf $15.25. Within 900 milliseconds from the opening, the stock price had fallen to $0.2848. Not exactly the kind of introduction an exchange that caters to the high-frequency trading world wanted to have.

Whether or not it was a mechanical failure or simple a lack of liquidity being provided the underwriters, the end result was the same. Whatever the problem was, it has taken the exchange just over four years to get it right.

For any short-term trader or long-term investors of an IPO, the opening print is very significant. The reason being for a short-term trader of an IPO, it will assist the trader in devising a strategy for the day. For longer-term investors that want to accumulate a larger position, the true actual opening print will be used to help determine to how to accumulate this position.

via Nanex

According to Brent Slava, Senior Research Analyst at Benzinga, multiple outlets reported a different opening price today. This may be partially explained by the uncertainty surrounding the opening print. Whereas the Think or Swim platform reported $22.66, another source reported $22.83. Dow Jones New Service reported the correct opening print of $22.88.

Shortly after the open, the issue sprinted to $23.38, but then quickly fell to $22.40 before staging a rebound. At time of writing, the issue was vacillating above and below the opening print.


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Posted-In: BATS BATS ExchangeNews Technicals IPOs Intraday Update Movers Trading Ideas

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