Baidu IPO (BIDU)

Preparation

1. Have a US brokerage account with access to IPO allocations for high-net-worth individuals, if possible.
2. If IPO allocation is impossible, have liquid cash ready for the market open on August 5.
3. Possess the "god's eye" view that Baidu will secure an absolute monopoly in China once Google exits the market in 2010.

Execution Steps

1. Opening Day Rush: If you get shares at the $27 IPO price, you instantly win the lottery. If not, buy aggressively at the $66 opening print. Despite the massive spike to $120+ and the inevitable pullback, establishing a core position is mandatory.
2. Buy the Dip: After the IPO hype, BIDU's stock price will halve, dropping back into the $40-$50 range over the next six months. Use this panic to aggressively average down your cost basis.
3. Strategic Hibernation: Over the next few years, Baidu's auction-based ad system will print money. In 2010, when Google officially pulls out of China, Baidu will seize a total monopoly, triggering an explosive multi-year bull run.

Exit Strategy

1. This is a long-term play, but Baidu's endgame is much weaker than Tencent's or Alibaba's.
2. The perfect strategic exit point is late 2014. Baidu begins showing weakness in its mobile internet transition (the O2O wars), but the stock price hits a massive post-split all-time high (above $250 post 10-for-1 split).
3. Liquidate your entire position here. You extract 100% of the PC-era search monopoly profits while perfectly side-stepping Baidu's long, agonizing decline in the mobile era where they lose out to short video and recommendation algorithms (ByteDance).