Its been three days since SNAP Inc., parent firm of temp photo-vid sharing social network Snapchat, began their initial public offering (IPO) on the NYSE. For the first two days the stock simply exploded, with 200 million shares sold to raise $3.4 billion, an increase in stock by 40 percent. So far so good; the company even managed to succeed in one other venue: that of engaging a particular target audience to invest in their IPO, the very same young people who are using their Snapchat mobile app. Not only did they snap up a portion of the IPO, now they’re in the mood to invest elsewhere too.

Young investors

Just as Snap Inc. had hoped in their pre-IPO hype campaign, a number of university-aged young people have decided to make Snapchat their first ever investment in the stock market. Take for instance 18-year-old University of California freshman Ryan Eshaghi, who claims to have been “addicted” to using Snapchat ever since the eighth grade. "It defined the way teens and young adults communicate with one another," Eshaghi remarked about the app (according to USA Today). Thus, using his savings from a part-time job of aiding high-school students prepare for college application exams, he went in and bought 20 shares of Snap Inc. stock. And he’s fully confident that the company will grow further from the IPO.

Willie Jamieson, aged 23, is a marketing hound in Charleston, South Carolina. His first investment was in Tesla, and he decided to partake in the Snap Inc. IPO as well. He believes that Snapchat going forward will have a lot of upsides that will make his investment grow.

The so-called “millennial” age group has never been a strong presence in the stock market, what with being more concerned with limited funds that usually go more into their student loans as well as bad memories of the last big stock crash.

Nevertheless, Snap Inc. gambled that their IPO could be marketed to these young adults, and they succeeded in enticing them to invest beyond their initial estimates.

The stock roller coaster

Then again, the stock market is the stock market; and one of the rules is that what goes up can also come down. On day three of the IPO, Snap Inc.’s shares have taken a dive in the wake of multiple “sell” recommendations put out by several expert brokers.

Already its fallen 19% from its high-mark and 12% when trading closed Monday March 6. Analyst Scott Kessler was surprised by the quick drop but assures investors that it’s the norm with new stocks that have sold hot off the bat. Still, Robinhood, an online stock trading mobile app, noted that its user base increased on a record high during the Snapchat IPO, where 43% of their registered traders went for Snapchat.
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