Initial public offerings inspire greed among beginning investors who hope to get in on the ground floor of a huge opportunity. The coming Twitter IPO has once again awakened avarice in the social-media world, especially now that long-suffering shareholders of Facebook (META 0.43%) have finally been vindicated after the stock's huge rebound recently.
But as the following slideshow describes, Twitter carries some huge risks -- 54 to be exact, according to the company's S-1 filing with the SEC. Just as many beginning investors who bought Facebook shares found out the hard way, IPOs don't always go the way companies intend, and early shareholders can end up with nasty surprises if they're not prepared for the potential fallout. By being aware of the risks, though, you can put yourself in the best position to make an informed choice about whether to buy Twitter shares after the company goes public.
Don't let Twitter's risks keep you out of stocks entirely
IPOs can definitely be risky, but even novice investors should still find ways to put money to work in the stock market. Otherwise, by remaining on the sidelines as millions of Americans have since the stock market meltdown five years ago, you could miss out on huge gains and put your financial future in jeopardy. But we've got easy ways for you to get started. By reading our brand-new special report, "Your Essential Guide to Start Investing Today," you'll get advice from The Motley Fool's personal finance experts on why you should invest and how to start investing today. Click here to get your copy right now -- it's absolutely free.
Tune in to Fool.com for Dan's regular columns on retirement, investing, and personal finance. You can follow him on Twitter @DanCaplinger.
