Zerodha CEO Drops Truth: Warna Retail Investors to Stay Away!
Kamath expresses the risk due to concerns of pre-IPO and unlisted shares. Zero liquidity, potential lock ups, price caveats, no transparency, valuation and dilution risk. Moreover, SEBI has warned various platforms against trading and unlisted shares as it can breach security laws.
In a recent post on X (formerly twitter) Kamath shared his personal experience on how a manager approached stockbroking platform Zerodha to buy shares in its unlisted company.
Nithin said- “Most investors think they can make easy money by picking these pre-IPO companies, waiting for the IPO, and making big listing gains. But it’s not as easy as it sounds, and there are all sorts of risks”.
Kamath advises that instead of chasing pre-IPO bets, the investors should favour regulated, low cost and transparent vehicles. Always stick to the listed stocks, mutual funds and SEBI governed.
The investors are suggested to avoid unlisted and pre-IPO market height and platform that shares at inflated prices. Moreover, always focus on building wealth through regulated investment especially mutual funds for index ETFs.
If the company is performing well, early investors can get multi-fold returns. It fosters High Returns Potential, Early Entry Advantage, Diversification, and Access to Emerging Business.
It is ideal for high
individuals or those who can take long-term bets and withstand risk.