Alibaba pre-IPO may have been eager to cash in on its increased market value of $84.50 on Tuesday, 24 percent above the $68 IPO price, when "lockup" agreements expired Wednesday.
However, experts were not eager on investing in Alibaba shares that have fallen about 30 percent from the post-IPO peak of $120 in November.
Alibaba opened on Sept. 19 at $92.70, ended its first day at $93.89, and reached its peak on Nov. 13 when it hit $120.
About 340 million shares valued at $29 billion were freed up after the 180-day lock-up period.
The Wall Street Journal noted that it is among the biggest chunks of stock freed from lock-up in one swoop after an IPO.
These are part of the 437 million shares that insiders were prohibited from selling during the said lock-up period.
However, out of these 437 million shares, 100 million shares held by Alibaba employees will become eligible for sale when the company announces its results in May.
Alibaba's IPO raised $25 billion, and while some early investors were able to sell immediately, many had to wait for Wednesday's lock-up release for the first opportunity of other pre-IPO investors to realize gains.
Another concern of investors is that with the company already having 1.12 billion shares for trading, adding 337 million shares to the total could drastically affect the stock price.
Furthermore, while rivals JD.com, Inc. Tencent Holdings Ltd. are both up by more than 19 percent this year, Alibaba's share has already seen a 19-percent decline.
There are a number of reasons for the recent weakness in Alibaba shares, such as being negatively impact by the increased use of smartphones and tablets as its users moved toward mobile shopping.
Alibaba also got into trouble over a report, which was later withdrawn, about counterfeit goods available on its platform.
Still Alibaba is confident about its prospects.
Alibaba's executive vice chairman Joseph Tsai described its quarterly results as showing "a strong foundation for future sustained growth."