- The Washington Times - Wednesday, February 29, 2012

Facebook’s imminent initial public offering has savvy investors looking for stocks to purchase - without directly buying the popular social network itself.

Rather than being sucked into buying overpriced shares of Facebook, Paul McWilliams, editor of the New Jersey-based Next Inning Technology Research, suggests that investors can benefit from the hype surrounding the Facebook IPO by buying shares of companies that will benefit as Facebook expands.

He mentioned specifically such companies as Intel, EMC, and Finisar, who all make Facebook-related goods.

“They’re going to have to build more data centers,” Mr. McWilliams said. “So who wins if Facebook starts growing? Go with the picks and the shovels.”

Kelley Damiani, vice president of Trippon Financial Publishing in Houston, told her clients to “capitalize on the frenzy” by purchasing shares of the “Global X Social Media Index ETF,” which will incorporate Facebook once it goes public.

“Instead of buying only Facebook and putting it all out there, you’re giving yourself a little protection,” she said.

Another strategy, she explained, would be investing in exchange-traded funds such as the social-media index, which have greater buying power than individual investors and will be able to purchase Facebook shares earlier and for less.

Federal regulators received notice Feb. 1 that Facebook intended to go public soon, and Ms. Damiani said she already had been suggesting that investors buy shares of this social-media index.

She also advises investors to consider selling their shares almost immediately, to take advantage of the expected spike during the first few days of trading and before the stock drops.

“It would be an easy, quick way of capturing a large percentage of gain,” Ms. Damiani said.