The IPOX® Week, April 13, 2020

  • Ahead of April options expiration, IPOX Indexes surge as global stimulus trumps fears over COVID-19’s economic impact; U.S. small-caps (RTY) stage big break-out from downtrend.
  • Amid “worst crisis” in confidence for Chinese companies listed in the U.S., IPOX China (CNI) set to break-even YTD.
  • IPO Deal-flow Review & Outlook: Biopharma Keros (KROS US) jumps in U.S. trading.

IPOX Indexes surge as global stimulus trumps fears over Covid-19’s economic impact. The IPOX Indexes recorded big gains during Easter Week, as the perceived positive impact of massive stimulus from governments and central banks around the world outweighed fears over the economic impact of COVID-19, as U.S. yields rose, equity risk declined for a third week (VIX: -10.96%) and hard-hit U.S. small-caps (RTY: +18.51%) finally found a bid higher. On the global level, e.g., the super-liquid IPOX Global 50 (IPGL50) – a portfolio of the largest companies pursuing a corporation action defined as an IPO, Spin-off or IPO M&A by applying the IPOX Indexes Technology – added +7.80% to -8.67% YTD, +827 bps. ahead of the global market YTD. Big gains extended across the IPOX Regional and IPOX Sector Indexes, with performance in line to somewhat lagging the benchmarks: While in the U.S., the IPOX 100 U.S. (ETF: FPX) traded between the Nasdaq 100 (NDX) and S&P 500 (SPX), a big week for European Small- and Mid-caps propelled the IPOX 100 Europe (ETF: FPXE), now +7.35 bps. ahead of the European market YTD. Here, Nordic-domiciled firms were standouts, with the IPOX Nordic (IPND) adding +9.43% to -6.33% YTD, e.g.,

In defense of China-linked IPO Investing: Amid “worst crisis” in confidence for Chinese companies listed in the U.S. since a decade ago, IPOX China (CNI) set to break-even YTD. Following the fall-out from the accounting scandal linked to Chinese coffee chain Luckin Coffee (LK US) – a former IPOX Portfolio Holding – we note another good week for the broad-based, diversified IPOX China (CNI) – adding +4.20% to -0.61% YTD – with companies including U.S. traded biotech Zai Lab (ZLAB US: +16.24%), application software maker Bilibili (BILI US: +11.28%) and electric maker NIO (NIO US: +11.25%) propelling the IPOX China (CNI) portfolio to almost break-even YTD. Strength amongst China-linked specialty deals also helped Momentum in the IPOX International (ETF: FPXI), now +1530 bps. ahead of the International Market YTD:

IPOX International (IPXI) Investing with the “FPXI” ETF since 2015

Select IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) 7.80 27.93 -8.67
IPOX® International (IPXI)* (USD) (ETF: FPXI) 6.79 31.37 -5.98
IPOX® Indexes: United States
IPOX® Composite U.S. (USD) 11.18 24.64 -12.80
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 11.43 29.60 -16.65
IPOX® ESG (IPXT) (USD) 10.82
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 5.87 34.55 -3.88
IPOX® Nordic (IPND) 9.43 38.52 -6.33
IPOX® 100 Europe (IPOE)* (USD) 7.26 30.97 -12.64
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 7.26 4.41 -11.57
IPOX® China (CNI) (USD) 4.20 26.31 -0.61
IPOX® Japan (IPJP)** (JPY) 8.22 37.91 -20.62

* Basis for ETFs: FPX US, FPX LN, FPXE US, FPXU FP, FPXI US, TCIP110 IT and CME-traded e-mini IPOX® 100 U.S. Futures (IPOM0). Source: Bloomberg L.P. & Refinitiv/Thomson Reuters.

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IPOX’s biggest IPOX Winners and Losers (this week in %):
NATIONAL VISION  46.19 BIONTECH -13.91
LEVI STRAUSS    44.90 CLOUDFLARE  -12.04
COUNTRYSIDE PROPERT. 43.84 CANSINO BIOLOGICS  -8.61
FARFETCH   42.13 RINGCENTRAL  -8.32
STONECO   41.08 INFRASTRUTTURE WIRE -7.59
ETSY INC 40.71 HOPE EDUCATION  -6.45
BRIGHTHOUSE FINANCIAL  39.70 EVERBRIDGE  -6.14
REDFIN   38.62 GILEAD SCIENCES  -6.01
HEROZ   38.01 HELLOFRESH  -5.63
CERIDIAN HCM HOLDING   37.46 TEAMVIEWER  -5.58
TOPBUILD  37.00 DELIVERY HERO -4.38
SAFEHOLD 36.51 KROGER -3.81
BILL.COM 36.36 ONECONNECT FINANCIAL -3.65


IPO Deal-flow Review and Outlook:
Biopharma Keros (KROS) debuts strongly.
While COVID-19 has upended the global IPO market, leaving only one deal across the global regions during the shortened U.S. trading week, clinical-stage biopharma Keros Therapeutics (KROS US: +34.81%) followed the strong initial performance of other healthcare IPOs this year. Lined up in Hong Kong is health supplements and skin care products maker Tycoon Group (3390 HK) which is taking advantage of the COVID-19 outbreak, recently beginning selling “anti-epidemic picks”, including surgical masks and disinfectant wipes. Other IPO News include: 1) Alibaba-backed AI startup Megvii Technology is enroute to a Hong Kong IPO, regardless of U.S. sanctions. 2) Set to clear $1 Billion revenue in 2020, Peter Thiel-backed Palantir Technologies closes in on IPO.

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