The IPOX® Week, June 14th, 2021

  • IPOX® Indexes extend recent gains ahead of re-balancing week. Decline in risk, shift to growth, lower U.S. yields support. IPOX® China (CNI) remains notable laggard.
  • IPOX® SPAC (SPAC) adds +1.02% last week.
  • Amid brisk IPO activity, strong IPO Momentum drives high initial returns for specialty deals. More deals lined up.

Summary: Most IPOX® Indexes extended the string of weekly gains ahead of option expiration, benefiting from muted equity risk (VIX: -4.69%), lower U.S. yields and the shift back into growth exposure. In the U.S., e.g., the IPOX® 100 U.S. (IPXO), underlying for the “FPX” ETF, added +2.65% to +4.99% YTD, topping the weekly U.S. equity indexes performance rankings.

IPOX® 100 U.S. (IPXO) since 2004 (ETF: FPX):

Strength extended to other Developed Markets-focused IPOX® Indexes, including the IPOX® Europe (ETF: FPX) and IPOX® Japan (IPJP), which set an all-time High towards the weekend. Weakness in China-linked stocks did little to derail another positive week for the IPOX® International (ETF: FPXI), which gained for a 4th week in a row, adding +0.69% to -1.38% YTD.

IPOX® Portfolio Holdings in focus: Amid the big bounce in growth stocks at the expense of value, select small caps linked to specialty industries recorded big gains last week, including highlighted biotech 06/2019 IPO Karuna Therapeutics (KRTX US: +23.77%), oversold and upgraded 06/2019 IPO online marketplace The RealReal (REAL US: +18.39%), expanding Japanese software developer 12/2019 IPO Freee (4478 JP: +15.66%), well reporting online styling platform operator 11/2017 IPO Stitch Fix (SFIX US: +15.44%) and red-hot big momentum play sporting goods retailer 10/2020 IPO Academy Sports & Outdoors (ASO US: +12.37%), which also finished the week at the highest level ever. Many China-linked stocks continued to lag, including leading dairy products maker 11/2019 IPO China Feihe (6186 HK: -9.13%), domestic China e-commerce behemoth 07/2018 IPO PDD (PDD US: -7.72%), leading “hot-pot” Mainland China and Hong Kong restaurant operator 09/2018 IPO Haidilao International (6862 HK: -5.58%).

Select IPOX® Indexes Price Returns (%) 2020 Last Week YTD
IPOX® Indexes: Global/International
IPOX® Global Super Liquid (IPGL50) (USD) 66.63 1.13 1.17
IPOX® International (IPXI) (USD) (ETF : FPXI) 72.15 0.69 -1.38
IPOX® Indexes: United States
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 47.32 2.65 4.99
IPOX® ESG (IPXT) (USD) 42.29 3.18 6.44
IPOX® SPAC (SPAC) (USD) 48.52 1.02 -0.92
IPOX® Indexes: Europe/Nordic
IPOX® Europe (IPOE) (USD) (ETF: FPXE) 35.14 0.72 4.93
IPOX® Nordic Core (IPND) (EUR) 59.89 0.95 15.65
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 47.50 2.47 0.00
IPOX® China Core (CNI) (USD) 88.02 -0.96 -7.47
IPOX® Japan (IPJP)(JPY) 25.75 3.14 3.46

* Basis for CME-traded e-mini IPOX® 100 U.S. Futures (IPOM1).

The IPOX® SPAC (SPAC) Index added +1.02% to -0.92% YTD and +47.17% since its 7/30/2020 launch. SPAC news include: 1) 7 SPACs Announced Merger Agreements include (partial): a) VPC Impact III with digital banking platform Dave; b) Yucaipa Acquisition with Berlin-based sports e-commerce and tech platform SIGNA Sports United; c) Khosla Ventures with drug discovery platform Valo Health and d) Kensington Capital II with Spanish EV charging startup Wallbox. 2) 10 SPACs Approved Business Combination include (partial): a) VG Acquisition with DNA test provider 23andMe (ME: 6/17); b) Churchill Capital II with online learning company Skillsoft (SKIL: 6/14) and c) Thunder Bridge II with indie Semiconductor (INDI: 6/11). 3) SPAC reportedly in talks for a business combination include Churchill Capital V with Amazon private-label businesses acquirer Thrasio. 4) 9 new SPACs launched last week, all in the U.S.

IPO Deal-flow Review and Outlook: At least 19 IPOs launched across the global markets last week with the average (median) equally weighted deal adding +18.79% (+16.78%) based on the final offer price and respective Friday’s close. Goldman Sachs-backed payment processor Marqueta (MQ US: +16.67%), mental health therapy provider LifeStance Health (LFST US: +33.33%), Israel project management platform Monday.com (MNDY US: +22.14%) all rose on above-range debuts. Tencent-backed Chinese online recruitment platform Kanzhun (BZ US: +95.79%) surged to be the best-performing IPO last week, initially. German fashion e-commerce retailer About You (YOU GR), French second-hand car seller Aramis (ARAMI FP), and Chinese upstream dairy industry service provider Youran Dairy (9858 HK) are set to launch this week. Other IPO news include: a) Chinese ride-hailing giant Didi Chuxing (Xiaoju Kuaizhi), grocery delivery apps Tencent-backed MissFresh and SoftBank-backed Dingdong Maicai all filed for U.S. IPOs and b) institutional investor-focused crypto exchange Kraken eyes IPO over Direct Listing & SPAC.

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