That dynamic has played out in many of the prominent I.P.O.s in recent years. Facebook shares opened 10 percent higher on their first day of trading and then proceeded to give back almost all those gains to finish essentially unchanged for the day.
Etsy was an extreme example of this. Its stock soared 94 percent on its first day of trading, but investors who bought at the open actually lost 3 percent by the close of trading.
And it’s not just tech companies. Levi Strauss recently made its return to the public markets, selling shares to investors at $17 a piece on March 20. The stock opened the next day at $22.22, a 31 percent jump. For the rest of trading that day, though, it climbed less than 1 percent.
Of course, if Lyft keeps growing as fast as Wall Street hopes it will, or works out how to turn a profit, then even the latecomers could wind up with respectable returns. Facebook shares are up more than 300 percent since their first day of trading, and after Etsy struggled for its first three years as a public company, its shares have more than doubled since they started trading.
Still, not being able to buy at the I.PO. price also greatly affects returns over the next year. Investors who bought shares at the offering price have averaged a 22 percent gain over the past decade. Returns for those that bought at the open? Sixty percent less.