Most IPOX® Strategies gain in January, outperform: Amid the background of big weakness towards month-end driven by de-risking amid a spike in equity risk (VIX: +45.45%) and stable global interest rates, most IPOX® Strategies finished January with gains, outperforming the benchmarks. In the U.S., e.g., the IPOX® 100 U.S. (FPX), multithematic play on the New Generation of U.S. domiciled stocks, rose +3.26%, outpacing the S&P 500 (SPX) and Nasdaq 100 (NDX) by +437 bps. and +297 bps., respectively. Strength extended to markets abroad with the IPOX® China (CNI) driving the IPOX® International (ETF: FPXI) to +1.24% higher, +235 bps. ahead of its benchmark. The IPOX® 100 Europe (FPXE)
kicked off 2021 with slighty loosses, finishing broadly in line with the benchmarks. Amongst Individual portfolio holdings, a jump in select small-mid caps linked to generational growth opportunities contributed to the solid overall showing, with Dubai-based software maker Yalla Group (YALA US: +77.88%), Israel-domiciled medical imaging technology provider Nano-X Imaging (NNOX US: +65.97%), U.S.-based online personalization platform operator Stitch Fix (SFIX US: +62.53%), security software maker direct listing Palantir (PLTR US: +49.38%), social media management software maker Sprout Social (SPT US: +45.34%), alternative meat producer Beyond Meat (BYND US: +42.46%) and enterprise software maker Appian (APPN US: +34.78%) in focus. Amongst large cap positions, we note strength in serial IPO acquirer IPO M&A drug maker Eli Lilly (LLY US: +23.18%). While China Technology exposure continued to rally, even bigger gains were recorded by real estate services providers and select consumer staples, including Ever Sunshine (1995 HK: +31.32%), Country Garden Services Holdings (6098 HK: +20.78%) and China Feihe (6186 HK: +27.75%). Indicative of a slowdown in the “red hot” sector, IPOX®-held payment processors weakened significantly during January, including Worldline (WLN FP: -11.43%), Nexi (NEXI IM: -10.34%), Adyen (ADYEN NA: -9.74%) and Fidelity National Information Services (FIS US: -12.72%).
|Select IPOX® Indexes Price Returns (%)||2020||Jan 2021||YTD|
|IPOX® Indexes: Global/International|
|IPOX® Global Super Liquid (IPGL50) (USD)||66.63||4.33||4.33|
|IPOX® International (IPXI) (USD) (ETF : FPXI)||72.15||1.24||1.24|
|IPOX® Indexes: United States|
|IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX)||47.32||3.26||3.26|
|IPOX® ESG (IPXT) (USD)||42.29||1.51||1.51|
|IPOX® SPAC (SPAC) (USD)**||48.52||6.16||6.16|
|IPOX® EV (IPEV) (USD)***||11.02||9.76||9.76|
|IPOX® Indexes: Europe/Nordic|
|IPOX® 100 Europe (IPOE) (USD) (ETF: FPXE)||35.14||-1.13||-1.13|
|IPOX® Nordic Core (IPND) (EUR)||59.89||-0.98||-0.98|
|IPOX® Indexes: Asia-Pacific/China|
|IPOX® Asia-Pacific (IPTA) (USD)||47.50||3.36||3.36|
|IPOX® China Core (CNI) (USD)||88.02||11.28||11.28|
|IPOX® Japan (IPJP)(JPY)||25.75||-2.97||-2.97|
* Basis for CME-traded e-mini IPOX® 100 U.S. Futures (IPOH1). Source: Bloomberg. Prices exclude dividends. **since July 30, 2020, ***since Nov. 17, 2020.
IPOX® SPAC (SPAC): The portfolio added +6.16% on the month, rising +57.68% since its 7/30/2020 launch, while the U.S. SPAC frenzy continued with 91 SPAC IPOs raising over $25 billion in total. 18 SPACs announced merger targets, 7 SPACs completed merger and another 69 SPACs filed for an IPO. Software SPAC Thoma Bravo Advantage (TBA US) was the largest offer in January, while Tech SPAC Altimeter Growth Corp 2 (AGCB US) soared +32.50% on its first day, the biggest first day pop in SPAC initial return history. Gores Holdings IV completed the largest SPAC merger on record with United Wholesale Mortgage (UWM US). Some of last week’s SPAC news included: 1) 9 SPACs Announced Merger Agreement including a) Alussa Energy with Norway-based battery cell developer FREYR; b) TPG Pace Tech Opportunities with online learning platform Nerdy; c) Andina III with healthy snacks maker Stryve.
January IPO Deal-flow Review and Outlook: At least 44 IPOs launched across the global markets (ex. SPAC, A-share, and Indian stock), raising more than $22 billion. The average (median) equally weighted IPO recorded an initial return of +27.36% (+20.27%) based on the final offer price and respective first day close. Deals in the U.S. accounted for most of global IPO deal flow with 24 IPOs (55%) going public and over $14 billion in proceeds raised (65%). We note strength in the European IPO market towards month-end with Advent-backed Polish parcel locker provider InPost (INPST NA) and iconic bootmaker Dr. Martens (DOC LN) going public. Tencent-backed healthcare data firm Yidu Tech (2158 HK) surged the most on debut, while buy-now-pay-later firm Affirm (AFRM US) scored the best performing YTD IPO. Chinese e-cigarette maker RLX Technology (RLX US), SAP spin-off software developer Qualtrics (XM US), pet store chain Petco (WOOF US) ranked amongst the high-profile deals in the U.S. A flurry of firms already lined up for February include 1,200x oversubscribed Chinese short-video sharing platform Kuaishou (1024 HK), German online used-car seller Auto1 (AG1 GR) and Thailand PTT Oil & Retail unit spin-off (OR TB).
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