[toby]

Everyone says this about the lock up and it makes sense intuitively, but it doesn't really match the data. I saw a presentation by a major investment bank that showed that in most cases there is not a significant drop following the lock up expiration -- I'm sure there are examples either way, but this was a compelling basket.

[zone411]

If the effect of early employees and investors selling after the lockup is significant, it wouldn't manifest itself as a drop after the lock up, it's a known date and it would be anticipated ahead of time by other investors and traders with the stock price reflecting this.

[toby]

Fair point -- I should have been more clear, this analysis was based on comparing the post-lockup price to the first trade, and also to the primary offering price (not 180 days to 179 days). You'd sometimes see a drop from the "pop" price, although not always, and it would almost never fall below the primary price.