The IPOX® Week, December 3, 2018

  • IPOX 100 U.S. (IPXO) records biggest weekly gain in five years, IPOX Asia-Pacific (IPTA) soars, too.
  • Continued gains in IPOX Japan (IPJP) cement positive IPO momentum ahead of Softbank’s mobile phone IPO.
  • IPO Deal-flow Review & Outlook: December pipeline builds. MA-based Moderna (MRNA US) set for largest VC-backed U.S. biotech IPO ever. More H.K. deals lined up.

IPOX 100 U.S. (IPXO) records biggest weekly gain in five years, IPOX Asia-Pacific (IPTA) soars, too. More certainty over the timing of the end of the FED-tightening cycle amid another week of stable U.S. yields, as well as good earnings propelled select IPOX Indexes to massive gains towards month-end. For example, the IPOX 100 U.S. (IPXO) – benchmark for U.S. New Listings – soared 5.37% to -0.06% YTD, marking its biggest weekly gain in five years and closing above the key 3000 level. While IPOX Europe (IXTE) lagged anew, big gains extended to Asia-Pacific with the IPOX Asia-Pacific (IPTA) moving into positive territory YTD, now a massive 1015 bps. YTD ahead of the regional benchmark. Beaten down high-beta exposure amid positive earnings recorded the biggest upside on the week, led by U.S. software makers Okta (OKTA US: 22.29%), online furniture seller Wayfair (W US: 20.08%) or cloud platform designer Nutanix (NTNX US: 11.91%), while some of IPOX’s core holdings, including payment processor PayPal (PYPL US: +10.08%) and drug maker AbbVie (ABBV US: +10.09%) also surged. We note another fresh weekly all-time high in Tokyo-traded IPOX-held specialty pharma SanBio (4592 JP: 9.75). Along the significant gains in IPOX Japan (IPJP) and other Japan-traded IPOX exposure in recent weeks, this provides a positive backdrop to the upcoming fixed-priced IPO of Softbank’s (9984 JP: 8.31%) USD billion 63 mobile phone business (9434 JP).

IPOX® 100 U.S. Investing with the ‘FPX’ ETF since 2006

Select IPOX-linked investment products surge: Select IPOX-linked investment products followed the big gains in the underlying IPOX Indexes. For example, the IPOX 100 U.S. (IPXO)-linked USD billion 1.1 First Trust U.S. Equity Opportunities ETF (FPX) added 5.27% last week to move back into positive territory YTD (0.30%), while the IPOX International (IPXI)-linked “FPXI” ETF also recovered 3.82% to -8.25% YTD. Amongst the range of actively managed IPOX-linked investment products, the Catalyst IPOX® Allocation Fund (OIPAX) added 4.50% to 4.27% YTD.

Select IPOX® Indexes Returns (%) Last Week 2017 2018 YTD
IPOX® Long-Only: Global/International
IPOX® Global (IPGL50) (USD) 3.88 28.59 -5.56
IPOX® International (IPXI)* (USD) 2.40 37.80 -9.58
IPOX® Long-Only: United States
IPOX® Composite U.S. (IPXC)* 5.23 33.64 1.58
IPOX® 100 U.S. (IPXO)* 5.37 26.04 -0.06
IPOX® 30 U.S. (IPXT) 5.20 26.63 -1.67
IPOX® Long-Only: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 0.53 19.27 -9.38
IPOX® Nordic (IPND) (EUR) 0.30 17.91 -12.51
IPOX® 100 Europe (IPOE)* (USD) 0.72 41.77 -13.37
IPOX® Long-Only: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 4.22 23.30 0.65
IPOX® China (CNI) (USD) 2.09 37.67 -14.98
IPOX® Japan (IPJP) (JPY) 4.56 N/A N/A

* Basis for ETPs: FPX US, FPX LN, FPXU FP, FPXI US, TCIP110 IT and CME-traded e-mini IPOX® 100 U.S. Futures [Symbol: IPOZ8]. ** Live since 03/18.

IPO Deal-flow Review & Outlook: December pipeline builds. MA-based Moderna (MRNA US) set for largest VC-backed U.S. biotech IPO ever. More H.K. deal lined up. A total of 8 firms debuted last week with the average (median) equally-weighted company adding +1.16% (+1.15%) based on the difference between the final offering price and Friday’s close. Most focus on the week was on the downsized unicorns debuting in Hong Kong including online parenting platform operator Babytree (1761 HK: 0.44%) and online travel agent Tongcheng-eLong (780 HK: 12.24%), both finishing the week above final offer. December is set to kick-off with a number of IPOs across global regions: In Europe, Danish advertising technology firm Adform (ADFORM DC), German InsurTech DFV (DFVA GR) and Swedish medical device developer Q-Linea (QLINEA SS) are lined up, while in the U.S., Cambridge, MA-based mRNA therapeutics company USD billion 8 Moderna (MRNA US) is set to surpass the October IPO of Allogene (ALLO US: 17.95%), a cancer research start-up founded by former Kite Pharma executives. Moderna has raised more than USD billion 2.6 billion in funding since its foundation, counting leading biopharmaceutical firms, government-sponsors, as well as high-profiled private investors as shareholders. Deals set to commence trading in other global regions include, for example, the IPO of China fashion content provider Mogu (MOGU US) on the NYSE and Chinese property management firm spin-off Kaisa Property (2168 HK) in Hong Kong.

Select IPOs traded (week: 11/26/2018) Domicile
Babytree Group China
Tongcheng-eLong Holding Ltd China
Select IPOs expected (week: 12/3/2018) Domicile
Adform A/S Sweden
iDreamSky Technology China
Moderna Inc United States
Synthorx Inc United States

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