A Small Investor Who Got Twitter at $26, Did You? (Update 2)

Updated from 1:58 p.m. ET, Friday, on Page Two with reports from individual investors and their TWTR IPO experiences.

NEW YORK (TheStreet) -- TheStreet's Antoine Gara is out with an excellent article Friday afternoon -- Maybe Facebook (FB) Priced Its IPO Better Than Twitter (TWTR).

Gara does an excellent job detailing differences between the two offerings. Here's a key excerpt: Reports from CNBC's David Faber indicate that Twitter's offering was oversubscribed by a multiple of 30. In contrast, interviews show that Facebook's underwriters were putting out calls to small institutional accounts and left large allocations for retail investors in order to fill the mammoth stock offering. Ordinary investors basically had the ability to buy as many Facebook shares as they wanted.

As far as I'm concerned this speaks to my outrage over the IPO process. It's a black box for smallish investors. In most cases, particularly the most lucrative ones, they can't get shares at the offer, leading to, as Gara reports, lots of retail activity in a name such as TWTR right out of the gate. Often not a good thing. Meantime, the Facebook IPO was apparently put out in front of hype-consuming, Peter Lynch-influenced and, in many cases, novice or brand new investors. But, hey, let's not balk at the SEC putting so much energy toward the dog and pony motions of chasing insider trading cases. Maintain. The. Status. Quo! That said, I came across an ordinary investor who actually received Twitter shares through his broker at the offer price. In other words, he put in a request and, his brokerage -- TD Ameritrade (AMTD) -- filled it. Here's his confirmation (though he will not disclose the number of shares he received): Did you get shares in TWTR? And, for that matter, FB? At the offer ahead of the respective IPO's open. If so, Tweet some screen shots and related information to me @Rocco_TheStreet. Also, if you didn't get shares of TWTR or FB at the offer, but bought either sometime during day one of trading, what's your situation with that position at this juncture? Here's an official statement from a TD Ameritrade spokesperson on the TWTR IPO as it relates to the firm: We have not disclosed the amount of our allocation, but as a minor participant you should assume that it was relatively small and that demand far outpaced the supply. All of our allocation went to retail investors - either self-directed investors or the clients of independent registered investment advisors who custody their assets with us. ... TWTR was our top traded equity yesterday, but only amounted to 5% of our clients' total trading volume. Some added color - we did see a great deal of interest and excitement around this IPO, which was expected given the popularity of the Twitter brand, but it was not at the same levels that we saw when Facebook went public. The TD Ameritrade spokesperson added that, on average, through October 25, 2013, its clients executed approximately 419,000 trades per day in the month of October (as of the 25th). The company released this data in its 10/29 quarterly earnings report. If we assume -- and the TD Ameritrade spokesperson did not confirm this -- that 419,000 trades took place via its platform Thursday, roughly 20,950 would have involved TWTR, using the above-mentioned 5% figure.

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I put the call out on Twitter for other investors who tried (and failed or succeeded) to get shares, at the offer, for the TWTR IPO. While this hardly qualifies as scientific research, it accomplishes something.

First, it provides hope that anything's possible. Generally, to get shares from your broker, you need a track record. Part of the black box that is the IPO process is that nobody really knows what that means because the brokerages don't explicitly tell us. And, of course, the SEC doesn't require them to.

Is a track record merely a large dollar value account or is it number of holdings, trades, types of positions, risk aversion profile? It would be nice if the application for IPO shares looked more like the standard process brokerages use to qualify customers to trade options. That's much easier to make sense of as you answer the regulator-mandated questions and submit your form. There are various approval levels. You can move between them. You know where you stand and, relative to the IPO situation, a better idea of why.

Back in the day when I was vying for IPO shares (I'm not that old; I just can't own individual stocks anymore!), I routinely asked for shares and never received any. Those experiences mean I can empathize with this guy: @Rocco_TheStreet last thing I wanna say. As a small investor who is learning my way as an AAPM, just felt duped. "Small"— jeremy rogers (@jjrog3) November 8, 2013 At the same time, I'm not naive. I understand the notion of supply and demand as well as the need to exercise control over it. However, we require some balance between top down-supplied order in the IPO process and color on how many shares get placed here and there. Jack Dorsey probably deserves every dime he receives in this process (though that's certainly arguable), but does the father-in-law of a hot shot who works for an IPO underwriter "deserve" shares any more than you do? I reckon not. Frankly, I'd love to see a list, detailing who (by rank in society!) asked for shares and a list of who actually received them. And why. Speaking of transparency, the following series of trade confirmation screenshots and Tweets from some readers of TheStreet not only let you know you're not alone as a smallish individual investor, but hope does exist even in what can feel like a crooked racket. @Rocco_TheStreet I asked Schwab for 200 shares of Twitter and got 100.— Loudoun (@rctmat) November 8, 2013 @Rocco_TheStreet Bid for 3,000 shared thru Fidelity. Got a big 0. No position now either.— Pete (@broncos1991) November 8, 2013 Smart man (^^). @TheStreet @jimcramer @Rocco_TheStreet I didn't get any shares through my broker, Fidelity :-(( I wish I had— Dragana Mendel (@DraganaMendel) November 8, 2013 You might be better off. I could see this thing dropping below the original offer price! That confirmation comes from a friend of mine, known as @CraigScott31 on Twitter, who told me -- and, despite being a New York Islanders fan, I have no reason to not believe him -- he was told not to sell inside 90 days if he wanted to sniff even a part of the Alibaba IPO. He also reports that ahead of the Facebook IPO, he received a call from his broker saying, "Great news! You asked for 1,000 shares, well I got you 5,000 shares." At that point, Craig notes, "I knew I was (expletive)." Just like the 2013 version of the Islanders. There's no doubt, the deck's stacked against the individual investor. All you can do is fight the good fight and put your foot to the floor, darling, and don't look back. Follow @rocco_thestreet --Written by Rocco Pendola in Santa Monica, Calif.

Rocco Pendola is a columnist and TheStreet's Director of Social Media. Pendola makes frequent appearances on national television networks such as CNN and CNBC as well as TheStreet TV. Whenever possible, Pendola uses hockey, Springsteen or Southern California references in his work. He lives in Santa Monica.