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Whether you鈥檙e obsessed with keeping your Snapstreaks going or have no idea what that means, you may be itching to invest in this week鈥檚 initial public offering of Snap Inc., parent company of the popular Snapchat app.

The appeal is understandable. For users of the app, owning shares of a company you use every day (or hour) can seem like a good investment. For nonusers, the urban legends of get-rich-quick IPOs are exciting enough on their own.

Of course, not every IPO is a success. And聽even if Snap gets off to a good start, its stock may still not be the best choice for you. Here are some tips on deciding whether Snap 鈥� or any highly anticipated IPO 鈥� deserves a place in your portfolio.

Consider the risk

When you鈥檙e first learning聽how to buy stocks, a hot prospect like Snap can be appealing. But there鈥檚 a lot to consider before you click the buy button.

Key questions to ask yourself include: Are you saving for retirement? Taking advantage of your employer鈥檚 401(k) match? Up to date on monthly expenses? Set up with a savings account to cover emergencies? Free of high-interest debt?

If you answered 鈥渘o鈥� to any of the above, tackle that first. If you鈥檙e buying stocks to make a quick return on money you may need within the next few years (or less), you may be setting yourself up for disaster. Even worse, you may be investing in the market with money you don鈥檛 actually have.

Whether you invest in a company that鈥檚 been trading for decades or one that鈥檚 issuing shares for the first time, the premise is the same: You expect the value will increase with time. Simply put, that鈥檚 not guaranteed. Stock prices can fluctuate wildly over the course of years, days or even hours.

IPOs are no exception. You may have heard cautionary tales of the dot-com era, such as Pets.com, which liquidated less than a year after going public. A more recent example is Facebook, which didn鈥檛 trade above its 2012 IPO price for more than a year.

Then again, Facebook shares have now more than tripled in value since going public. This type of reward potential, along with the ease of trading, makes stocks appealing to many investors. But beware the flip side of stocks: You could also lose your entire investment.

Don鈥檛 lose sight of diversity

Still salivating over one particular stock? Put it in perspective. Ideally, purchases of individual stock should complement an existing, diversified portfolio. Pouring any significant amount of money into one young company鈥檚 stock doesn鈥檛 generally fit that theme, particularly if that purchase is among your first investments.

Sure, the goal of investing is to grow assets over time. But an equally important consideration is reducing risk so your investment isn鈥檛 subject to the fate of one company (or industry).

If you鈥檙e new to investing, building a diversified portfolio may seem more daunting than buying shares of a few companies here and there. The good news? It鈥檚 not.

If you have a 401(k) or similar employer-sponsored plan, that鈥檚 a great place to seek diversity. These accounts typically offer a small list of fund choices, with options for different asset types (stocks or bonds, for example), geographies (U.S., international or emerging markets) and company sizes (from small to large cap).

You can find similar options in an individual retirement account, where exchange-traded funds and index funds offer an easy way to diversify. These funds allow you to distribute money across a variety of companies, industries or asset types 鈥� often with relatively low fees.

When an IPO makes sense

There鈥檚 nothing wrong with owning individual stocks. During your lifetime you may acquire them in a variety of ways 鈥� a gift from a relative or as employee stock options, for example. They could prove to be fantastic or terrible investments, and if you have only a few, they won鈥檛 dictate your portfolio鈥檚 success or failure. That goes for IPOs as well as shares from established companies.

But if you鈥檙e a beginning investor with, say, $5,000 at your disposal, investing it all in one company is risky, especially if you don鈥檛 have a long-term strategy in mind. If your long-term strategy is hazy, read up on聽how to start investing聽before you jump into any IPOs.

No matter what piqued your interest in investing, consider it a blessing. The road to retirement is long, and you鈥檒l inevitably encounter bumps along the way. But those can be alleviated by managing your risks, diversifying and investing for the long haul.

After all, you don鈥檛 want your time in the market to be ephemeral, like the photos on a certain app.

Anna-Louise Jackson is a staff writer at NerdWallet, a personal finance website. Email:聽ajackson@nerdwallet.com. Twitter:聽@aljax7.

This story originally appears on NerdWallet.聽