The MTCH Stock Price Today Is Climbing on This One Factor

The Match Group Inc. (Nasdaq: MTCH) stock price today (Friday) is trading near $16 per share in late morning trading after the successful Match.com IPO yesterday.

online-dating-guyThe Match IPO stock price was set at $12 on Wednesday, and MTCH stock opened at $13.50 yesterday. For investors who were able to buy the IPO price of $12, MTCH stock provided an 18.58% gain in its first day of trading.

More than 10 million shares were traded by noon yesterday, as the Match IPO was one of the most anticipated IPOs of 2015.

Despite an unfavorable 2015 IPO market, MTCH stock attracted investors because of the profitable online dating industry. According to Financial Times, the online dating industry is now worth roughly $2 billion.

Match Group has a clear dominance in the online dating market, with 59 million active monthly users. The company serves large and niche markets alike. Its holdings include OurTime (the 50-plus dating market), Tinder (millennial dating), and Meetic (European dating market).

Having a reach into all of these markets has also allowed Match Group to grow revenue and profits year over year. Match reported revenue of $88.2 million in 2014, which is a 10.6% increase from 2013. Profits increased from $90.3 million in 2012 to $148 million in 2014, representing growth of 38.8% in just two years.

While these numbers might make MTCH stock look like a sound investment, there is really only one reason why the MTCH stock price today is climbing. And it's the biggest reason why you shouldn't rush out to buy MTCH stock...

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The MTCH Stock Price Today Is Rising Purely from Hype

At an event at TechCrunch Disrupt in 2014, entrepreneur Mark Cuban said investors in Silicon Valley suffer from FOMO - fear of missing out.

Hype and fear of missing out are what's driving up the MTCH stock price today. When the average investor hears about a new IPO or the first-day gains from an IPO, they often kick themselves for not getting in on the stock early.

But what they don't realize is that the IPO game is flawed for retail investors.

You see, when so many people rush into these IPOs, the share price is driven higher very quickly. At this point, the stock price is already inflated and it is almost impossible to bank serious profits. The biggest gains are always made by wealthy Wall Street investors who were able to buy into the company at the IPO price.

Money Morning Chief Investment Strategist Keith Fitz-Gerald warns that the odds are stacked against retail investors.

"IPOs are little more than a get-rich-quick scheme that's so heavily stacked against you that it makes the house odds in Vegas seem downright conservative," said Fitz-Gerald. "I say that because you are literally the last in a long line of people who are going to profit from the IPO process."

The MTCH stock price today may continue to rise, but investors should not buy into these inflated prices.

But there is a way you can make long-term profits off of Match Group without directly investing in MTCH stock. Our Capital Wave Strategist Shah Gilani has a way you can profit 21.87% from Match Group right here...

Jack Delaney is an Associate Editor for Money Morning. You can follow him on Twitter and follow Money Morning on Facebook.

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