If you're a Silicon Valley insider, it's no longer enough to be on the inside for a red-hot initial public offering. The true A-list investors buy the hottest companies long before they go public, racking up big gains before any mere individual investor can buy a single share.
The rewards are lucrative enough that some fund families, such as Fidelity and T. Rowe Price, are investing in companies before they sell shares to the public. Is this something fund owners should be concerned about? In most cases, no.
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John Waggoner does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.