How Alibaba IPO learnt from Facebook's mistake

By Dai Tian (chinadaily.com.cn) Updated: 2014-09-17 10:56

Alibaba options expected to be listed on Sept 29: exchanges

Jack Ma shows up in Singapore for Alibaba IPO roadshow

A glitch in Nasdaq systems caused hours of delay for certain trading orders on the launch day of the $16 billion IPO. According to the Securities and Exchange Commission, Nasdaq has to offer $62 million as compensation for investors' losses.

"JD and other newly-listed Internet companies are not as big as Alibaba. Liquidity should be a top concern," said Tang Jia, a researcher from Analysys International, to chinadaily.com.cn.

But the decision not to go with Nasdaq comes at price of losing potential ETF investors.

Tang said that Alibaba won't be included in the S&P 500 Index, as it's registered in Cayman Islands and the index only includes US companies.

Listing on the Nasdaq would have guaranteed its inclusion in the Nasdaq 100 Index by the end of the year, and funds tracking the index would have to buy, which could mean at least $1.7 billion, said Reuters.

"The price range is a bit high to retail investors, who normally contribute most liquidity," said Tang, adding that Alibaba's appointing Barclay as the leading market maker and Goldman Sachs as stabilization agent overseeing its early trading would be positive to liquidity.