The IPOX® Week, June 8, 2020

  • Key IPOX Strategies extend May gains. Relative momentum slows towards week-end as markets play catch-up.
  • FANG-free, broad-based IPOX 100 U.S. (ETF: FPX) gains to +2.22%. Diversified IPOX International (ETF: FPXI) rises to +18.27% YTD, “FPXI” ETF surpasses $100 million AUM mark.
  • IPO Activity picks up rapidly. U.S. sees busiest week YTD.

Key IPOX Strategies extend May gains. Relative momentum slows towards the week-end as Markets play catch-up & yields soar. The IPOX Strategies extended the strong returns recorded during May into the first week of June with multiple strategies closing the week at or near all-time highs. Much better-than-expected U.S. economic numbers provided for more smooth sailing for equities into the week-end, amid 1) big fiscal stimulus in Germany/Europe, 2) declining fears over Covid-19, 3) U.S. social unrests, 4) significant gains for the EUR, 5) soaring U.S. yields and 6) derivatives-linked benchmark positioning into June 19th, U.S. Futures and Options expiration. Outside of the IPOX China Core (CNI), relative momentum in the IPOX Strategies, however, slowed considerably towards the week-end on a big catch-up in value stocks.

FANG-free, broad-based IPOX 100 U.S. (ETF: FPX) gains to +2.22% YTD. Diversified IPOX International (ETF: FPXI) rises to +18.27% YTD, closes week at fresh all-time high. In the U.S., e.g., the IPOX 100 U.S. (IPXO), underlying for the $1.3 billion “FPX” ETF, added +1.84% to +2.22% YTD, lagging the major U.S. benchmarks. Relative weakness extended to the IPOX International (ETF: FPXI) which still rose for a 10th week in a row. Helped by a surge in the EUR, the index closed at a fresh weekly all-time high, adding +3.39% to +18.27% YTD with AUM of the “FPXI” ETF surpassing the $100 million AUM mark for the first time and now ranking amongst the fastest growing U.S.-traded ETFs YTD. On the back of big gains for Chinese electric car maker Nio (NIO US: +40.45%) and heavily shorted application software maker GSX Techedu (GSX US: +29.21%), we also note the fresh multi-year high in the broad, diversified IPOX China Core (CNI), which added +5.93% to +21.32% YTD. Ahead of big China-linked deal-flow, the unique portfolio provides diversified exposure to the largest, most liquid, accessible, non-A share China-linked companies trading in Hong Kong and the United States via a stable portfolio technology.

IPOX International ETF (FPXI) surpasses USD million 100 AUM

Long-only IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) 2.58 27.93 15.73
IPOX® International (IPXI)* (USD) (ETF: FPXI) 3.39 31.37 18.27
IPOX® Indexes: United States
IPOX® Composite U.S. (IPXC) (USD) 3.23 24.65 5.92
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 1.84 29.60 2.22
IPOX® ESG (IPXT) (USD) 2.56
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 0.36 34.55 15.42
IPOX® Nordic (IPND) 2.91 38.52 18.06
IPOX® 100 Europe (IPOE)* (USD) 2.46 30.97 5.73
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 2.51 4.41 11.95
IPOX® China (CNI) (USD) 5.93 26.31 21.32
IPOX® Japan (IPJP)** (JPY) -0.19 37.91 -3.29

* 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. For IPOX Alternative Strategies Returns, please contact [email protected]

IPOX-linked ETFs (FPX, FPXI, FPXE) Movers (Last Week in %):
GSX TECHEDU (FPXI) 29.21 SMARTSHEET (FPX) -22.75
AIB GROUP (FPXE) 26.63 EVERBRIDGE (FPX) -15.29
CARVANA (FPX) 24.62 ZEALAND PHARMA (FPXE) -10.10
STONECO (FPXI) 23.83 PRINCIPIA BIO. (FPX) -9.02
ACADEMEDIA (FPXE) 23.45 ALECTOR (FPX) -8.29
EQT (FPXE) 22.32 RINGCENTRAL (FPX) -7.79
ARDAGH GROUP (FPXE) 20.85 CABLE ONE (FPX) -7.69
XP (FPXI) 20.49 OKTA (FPX) -7.66
BRIGHTHOUSE FIN. (FPX) 19.76 NORTONLIFELOCK (FPX) -7.59
LEVI STRAUSS (FPX) 19.13 AVALARA (FPX) -7.44

IPO Deal-flow Review and Outlook: IPO activity picks up rapidly. U.S. sees the busiest week YTD. Warner Music and ZoomInfo surged on highly anticipated debut. At least 11 IPOs commenced trading across the global regions last week with the average (median) equally-weighted deal surging +29.56% (+28.43%) based on the difference between the final offering price and their respective Friday’s close. Carlyle-backed B2B database unicorn ZoomInfo (ZI US: +85.19%), cell therapy spin-off Legend Biotech (LEGN US: +60.87%), payment processor Shift4 (FOUR US: +45.85%), record label giant Warner Music (WMG US: +19.76%), along with a slew of biotech IPOs all soared in their U.S. debut. Tencent-backed payment company Yeahka (9923 HK: +5.89%) also closed the week higher, despite its initial slump. JD-backed Chinese grocery delivery platform Dada Nexus (DADA US: -0.06%) however, fell, ranking as the only IPO to record a negative initial return last week. More deals this week include leading internet technology company NetEase (9999 HK), which returns to the Chinese market with a secondary offering. In the U.S. Carvana (CVNA US: +24.62%) rival, online used car seller Vroom (VRM US) is lined up. Other IPO news include: 1) telehealth provider American Well (Amwell) files for confidential IPO; 2) Chinese owned Israeli gaming company Playtika plans for $1 billion U.S. IPO; 3) Italian mask maker GVS to go public as the European IPO market sees strong revival.

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