The IPOX® Week, March 30, 2020

  • IPOX® Indexes rise sharply after U.S. Futures and Option expiration as massive global stimulus outweigh COVID-19.
  • IPOX® Global Alternative Strategy on course for best quarterly performance on record.
  • IPO Deal-flow Review & Outlook: Much anticipated cancer drugs developer InnoCare Pharma (9969 HK) surges in H.K. trading debut. Quiet April ahead from global New Listings.

IPOX® Indexes rise sharply after U.S. Futures and Option expiration as massive global stimulus outweigh COVID-19. The IPOX Indexes followed the strong bounce in global equities after the big dislocations during U.S. Futures and Options expiration week, with the IPOX Global 50 (IPGL50) – benchmark for the performance of global New Listings by applying the IPOX Indexes Technology – surging by +8.49% to -13.05% YTD, +948 bps. ahead of global equities YTD. Gains extended across regions, themes and sectors, including the IPOX International (ETF: FPXI), IPOX 100 U.S. (ETF: FPX), IPOX Europe (ETF: FPXE) and IPOX China (CNI). During the quarter, most notable has been relative performance difference

IPOX® International Investing (ETF: FPXI) since Fund launch:

displayed by some of the key IPOX Strategies: While the diversified IPOX 100 U.S. (ETF: FPX) has been leading the Russell 2000 (RTY) and somewhat lagging the S&P 500 (SPX), big relative gains in the IPOX China (CNI) and IPOX Europe (ETF: FPXE) have been propelling the IPOX International (ETF: FPXI) by a massive +1515 bps. vs. international equities YTD (see Chart above for performance of the FPXI ETF since launch). The massive relative divergence in global equities baskets as defined by IPOX not seen since 2008 also benefited the IPOX Global Alternative Strategy during this quarter, adding +23.19 YTD with all regional strategy legs recording significant gains. Amongst individual IPOX portfolio holdings, last week’s top performers in the IPOX 100 U.S. (ETF: FPX) included the previous week’s biggest decliners, led by car vending machine operator Carvana (CVNA US: +67.09%) and Financials Brighthouse Financial (BHF US: +56.53%) and Equitable Holdings (EQH US: +38.89%), while Japan-traded internet services provider Mercari (4385 JP: +35.03%), Hong Kong traded food ingredients maker Yihai International (1579 HK: +25.00%) and property management provider Ever Sunshine Lifestyle Services Group (1995 HK: +24.82%), as well as U.S.-traded Brazilian Financial XP (XP US: +24.08%) ranked on top of the IPOX International (ETF: FPXI). We also note the addition of Riyad-traded leading global energy firm Saudi Aramco (ARMCO AB: +1.87%) to the IPOX International (ETF: FPXI), making the “FPXI” ETF one of the few ETFs available for U.S. investors with exposure to the company.

Select IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) 8.49 27.93 -13.05
IPOX® Global Alternative (USD) -2.20 -1.96 23.19
IPOX® International (IPXI)* (USD) (ETF: FPXI) 7.98 31.37 -9.47
IPOX® Indexes: United States
IPOX® Composite U.S. (USD) 10.70 24.64 -18.96
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 9.68 29.60 -22.99
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 7.54 34.55 -9.77
IPOX® Nordic (IPND) 5.82 38.52 -16.59
IPOX® 100 Europe (IPOE)* (USD) 10.19 30.97 -16.73
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 9.95 4.41 -13.88
IPOX® China (CNI) (USD) 3.70 26.31 -4.34
IPOX® Japan (IPJP)** (JPY) 9.64 37.91 -23.10

* 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.

IPO Deal-flow Review and Outlook: Much-anticipated cancer drugs developer InnoCare Pharma (9969 HK) rises in H.K. trading debut. Quiet April ahead for global New Listings activity. Only 2 firms commenced trading across the global regions last week with the average equally weighted deal losing -9.36% based on the difference between the final IPO offering price and Friday’s close. Amid the massive oversubscription by Hong Kong retail leading to top-of-range pricing, Chinese cancer drugs biotech InnoCare (9969 HK: +22.01%) soared on its Hong Kong debut, while Japanese metal waste recycling group Rever (5690 JP: -40.73%) fell steeply based on final offer on the week. Hong Kong continues to dominate global IPO listings activity with Chinese AR-advertising software WiMi Hologram (WIMI US) set to debut, with no other offers scheduled for the week ahead. Amid the coronavirus pandemic, the global IPO market in Q1 saw a significant decline in both number of New Listings and proceeds raised: The U.S. ranked top with 20 IPOs taking place, raising over $7B in total proceeds during Q1. The largest listings belonged to Thailand’s Central Retail (CRC TB), followed by U.S. drug researcher CRO PPD (PPD US) and Canadian waste hauler GFL Environmental (GFL US), respectively.

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