Dropped Like a Rock

I was convinced that the initial public offering (IPO) of privateequity giant Blackstone Group was going to follow MasterCard and Google through the roof. Instead of doing that, it dropped like a rock. I think the price that I officially bought in at was around $36. With the price recently in the $20s, it is hard not to try to buy again so that I don't have to eat the whole loss. - Al Zutz, Bemidji, Minn.

The Fool Responds: Adding to a losing position is often a bad idea, unless you've done enough research to be convinced that the company has a terrific future.

It's also risky to jump into IPOs at their outsets, because IPO successes such as Google and MasterCard are not the norm. Many times, companies making their debut on the stock market have little in the way of a track record that you can examine.

Many times, they're not even very profitable yet. It's often best to hang back and see how the stock fares in its first years. Many IPOs surge quickly, only to fall back to Earth later.

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