Online Brokers 2000: IPO Policies Leave Investors Hungry

The flood of initial public offerings continues to rise. The total approached $8 billion in February, and when the March tally is completed, bankers figure the total will exceed $11 billion. April could bring another record if, as expected, AT&T's wireless spinoff raises as much as $11.5 billion. With so many shares being floated, you might think that access to IPOs via online brokers is improving.

Think again. Although ordinary investors often dream of making a quick killing when an IPO takes off, the chance to get in on one remains slim indeed. Despite the record volumes, demand for shares of hot new issues such as the recent Palm (PALM Quote) offering remains intense, and most shares go to large institutions and major investors, leaving few shares for retail customers. While the average investor in TheStreet.com's Online Broker Poll 2000 did not rate access to IPOs a top priority, it is a big deal for many active investors. (To see complete results of the 10,000-reader survery, please see previously published stories in the Online Brokers 2000 package).

Many online brokerages say they are trying to make IPO shares more widely available to their customers. ...