The IPOX® Week, May 14, 2018

  • Earnings strength drives IPOX Indexes to big week / IPOX 100 U.S. tops weekly performance rankings.
  • IPO Deal-flow Review & Outlook: AXA Equitable marks biggest U.S. IPO YTD, Vietnam stock exchange readies largest IPO in its history.

Earnings strength drives IPOX Indexes to big week / IPOX 100 U.S. (IPXO) tops weekly performance rankings. The Apple (AAPL: +2.98) -free IPOX Indexes recorded strong gains last week, as investors refocused on underlying earnings strength amid supportive U.S. economic numbers and little geopolitical headwind. In the U.S., e.g., the diversified IPOX 100 U.S. (IPXO) – benchmark for the performance of U.S. New Listings – added +3.60% to +4.40% YTD, outpacing the S&P 500 (SPX) by +119 bps. and ranking as the best performing diversified U.S. equity index on the week. Amid big strength in some of its heavily weighted core positions including U.S. payment processor PayPal (PYPL US: +7.04%) or large pharma Takeda (4502 JP: +3.23%) takeover target IPOX Holding Shire (SHPG US: +5.53%), specialty small-cap exposure including application software maker New Relic (NEWR US: +22.20%), rebounding social networker Match Group (MTCH US: +16.31%) or medical devices maker Penumbra (PEN US: +13.85%) drove some of the good showing. IL-based recreational vehicles maker 10/16 IPO Camping World Holdings (CWH US: -17.20%) – whose CEO was featured as a notable seller of high-end Chicago real-estate in Crain’s during the week – continued to trade under big pressure. In exposure trading outside the U.S., IPOX heavyweight 10/14 IPO Tokyo-listed professional services firm Recruit (6098 JP: +8.02%) surged as investors applauded the pre-IPO acquisition of U.S. based jobs site Glassdoor for USD billion 1.2, while IPOX Europe 100 (IPGL30) Portfolio holding London-based property platform 06/14 IPO ZPG (ZPG LN: +30.85%) surged after receiving a buy-out offer from U.S. private equity firm Silver Lake.

IPOX-linked ETFs (FPX, FPXI) mirror gains in underlying IPOX Indexes: The USD billion 1.1 IPOX 100 U.S. (IPXO)-linked First Trust U.S. Equity Opportunities ETF (FPX) surged +3.50% to +4.49% YTD. Linked to the IPOX International (IPXI), the First Trust International IPO ETF (FPXI) rose to +5.58% YTD.

IPOX® 100 U.S. – Investing with the “FPX” ETF since 2006

IPOX Price Returns (%) Last Week 2017 2018 YTD
Exposure: Global/International (xUS) (USD) (Price)
IPOX Global (IPGL50) 2.33 28.59 4.57
IPOX International (IPXI)* 1.51 37.80 4.45
Exposure: United States (USD) (Price)
IPOX Composite U.S. (IPXC)* 2.73 33.64 5.95
IPOX 100 U.S. (IPXO)* 3.60 26.04 4.40
IPOX 30 U.S. (IPXT) 3.58 26.63 2.09
Exposure: Europe/Nordic Region (EUR) (Price)
IPOX Europe (IXTE) 0.95 19.27 6.11
IPOX Nordic (IPND) 1.83 17.91 0.52
Exposure: Asia-Pacific/China Region (USD) (Price)
IPOX Asia-Pacific (IPTA) 1.50 23.30 3.19
IPOX China (CNI) 2.17 37.67 11.94

* Basis for ETPs: FPX US, FPX LN, FPXU FP, FPXI US, TCIP110 IT and CME listed e-mini IPOX® 100 U.S. Index Futures [Symbol: IPOM8].

IPO Deal-flow Review & Outlook: AXA Equitable marks biggest U.S. IPO YTD, Vietnam stock exchange readies largest IPO in its history. At least 15 notable (non-China A shares and non-local India) firms debuted last week, with the average (median) equally-weighted firm adding +15.29% (+10.50%) based on the difference between the final offering price and Friday’s close. Most focus was on the IPO of Financial AXA Equitable (EQH US: +6.95%), the largest U.S. listing YTD. Amid a negative open and after having seen its valuation significantly reduced into its IPO, the firm closed its first week of trading well supported. European deals struggled with academic publisher P/E-backed Springer Nature and Spanish real estate company Azora Altus suspending listing efforts, citing adverse market conditions. Deals in Emerging South East Asia take center stage this week with at least 5 deals lined up, including the IPO of real estate developer Vinhomes JSC (VHM VN), the largest IPO on the Vietnam Stock Exchange in its history.

Select IPOs traded (week: 05/07/2018) Country
Avast PLC Britain
AXA Equitable Holdings Inc United States
Bank Tabungan Pensiunan Nasional Syariah Tbk PT Indonesia
Evelo Biosciences Inc United States
HUYA Inc China
Libstar Holdings Ltd South Africa
NFON AG Germany
Origin Bancorp Inc United States
Select IPOs expected (week: 05/14/2018) Country
Asuransi Tugu Pratama Indonesia Indonesia
Evans Dixon Ltd Australia
Medikalika Hermina Tbk PT Indonesia
Ovzon AB Sweden
Pluralsight Inc United States
Royal Prima Tbk PT Indonesia
Somec SpA Italy
Surya Pertiwi Tbk PT Indonesia
Vinhomes JSC Vietnam

Josef Schuster is the founder of IPOX Schuster LLC (www.ipoxschuster.com), a Chicago-based Financial Services company specialized in Financial Products Design related to Initial Public Offerings and corporate Spin-offs. He is the chief architect of the IPOX Indexes, a global index group initiated in 2004 that encompasses an index technology allowing for asset-allocation focused exposure to the “going public” effect associated with global IPOs and Spin-offs. Mr. Schuster earned his Bachelor of Arts degree in Business Administration in 1994 from the European Business School, London. Mr. Schuster was also awarded a MSc in Accounting and Finance in August 1996 and a MPhil / PhD in Accounting and Finance in June 2003 from the London School of Economics.

ABOUT THE IPOX INDEXES: Through the range of the IPOX Indexes, market participants have an innovative opportunity to navigate the global IPO and Spin-off market and to track the performance of this economically significant sector more accurately and comprehensively than with any other index group. The IPOX Indexes accomplish the systematic indexation of the aftermarket performance of the IPO and Spin-off sector, while – at the same time – preserving the benefits of diversification. Linked to the IPOX 100 U.S. Index, for example, IPOX-linked investment products available to investors include the pioneering USD million 600, 5-star First Trust U.S. IPO ETF (ticker: FPX). On February 18, 2016, CME Group, the world’s largest exchange operator, launched e-mini IPOX 100 U.S. Index Futures, offering market participants for the first time a tool to manage the aggregate risk associated with U.S. IPOs and Spin-offs.

Lime Brokerage LLC is not affiliated with these service providers. Data, information, and material (“content”) is provided for informational and educational purposes only. This content neither is, nor should be construed as an offer, solicitation, or recommendation to buy or sell any securities. Any investment decisions made by the user through the use of such content is solely based on the users independent analysis taking into consideration your financial circumstances, investment objectives, and risk tolerance. Lime Brokerage LLC does not endorse, offer or recommend any of the services provided by any of the above service providers and any service used to execute any trading strategies are solely based on the independent analysis of the user.

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