The IPOX® Week, May 20, 2019

  • IPOX  100 U.S. (ETF: FPX) most resilient; dodges most downside recorded by U.S. equity benchmarks for 2nd week.
  • IPOX Regional Exposure in focus: IPOX Nordic Core.
  • IPO Deal-flow Review & Outlook: PIMCO postpones its $1 billion Mortgage REIT (PMTG US) IPO, Private equity backed debt-heavy chemicals/materials maker Avantor (AVTR US) climbs on debut, Bicycle Therapeutics (BCYC US) lined up.

IPOX  100 U.S. (ETF: FPX) most resilient; Dodges most downside recorded by U.S. equity benchmarks for 2nd week. The key IPOX Indexes finished May options expiration week categorized by a) big news-driven sentiment swings in the generally weak U.S. equity benchmarks (VIX: -0.50%) and b) lower U.S. yields driven by trade stalemate underpinned by solid U.S. economic data on Top of the weekly equities performance rankings. E.g., amid positive weekly fund flows into the ETF, the FANG-free, diversified, large-cap centric IPOX 100 U.S. (ETF: FPX) declined by just -0.29% to +22.09% YTD, extending the YTD relative performance jump vs. the S&P 500 (SPX) – benchmark for U.S. stocks – by +47 bps. to +802 bps. YTD. Relative strength extended to other world regions with a notable jump in the IPOX Nordic Core (IPND). Here, the portfolio added +1.11% to +18.28% YTD last week, now +1179 bps. ahead of the Nordic market YTD. IPOX-held social media exposure including Snap (SNAP US: +9.53%) and Match Group (MTCH US) stood out in the U.S. Portfolio (ETF: FPX), while German battery maker Varta (VAR1 GY: +10.82%) and French vehicle services provider Ald (ALD FP: +9.36%) ranked top in the European portfolio (ETF: FPXE). Software maker Greensky (GSKY US: -15.56%), personal shopping platform operator Stitch Fix (SFIX US: -12.56%) and Spin-off Baxalta/Shire buyer big pharma Takeda (TAK US: -11.68%) weighed on IPOX portfolio returns.

IPOX 100 U.S.-Style Investing with the “FPX” ETF since 2006.  

Performance Update for IPOX-linked Funds: The IPOX 100 U.S. (IPXO)-linked, 5-star (10-years) $1.2 billion First Trust U.S. Equity Opportunities ETF (FPX) fell -0.29% to finish last week at +22.42% YTD, while the IPOX International (IPXI)-linked 4-star (3-years) First Trust International Equity Opportunities ETF (FPXI) and the IPOX 100 Europe (IPOE)-linked First Trust IPOX® Europe Equity Opportunities ETF (FPXE) closed the week at +14.64% YTD and +17.85% YTD, respectively. Amongst actively managed IPOX-linked funds, the Catalyst IPOX® Allocation Fund (OIPAX) – a 2019 Thomson Lipper Award Winner – climbed to +20.82% YTD.

Select IPOX® Indexes Price Returns (%) Last Week 2018 2019 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) -0.61 -11.37 18.48
IPOX® International (IPXI)* (USD) -1.06 -13.41 12.60
IPOX® Indexes: United States
IPOX® Composite U.S. (IPXC)* -0.89 -7.59 15.89
IPOX® 100 U.S. (IPXO)* -0.29 -8.80 22.09
IPOX® 30 U.S. (IPXT) -0.43 -10.28 17.28
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 1.68 -13.46 18.66
IPOX® Nordic (IPND) 1.11 -15.45 18.28
IPOX® 100 Europe (IPOE)* (USD) 0.18 -16.60 15.79
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) -0.97 -3.21 1.67
IPOX® China (CNI) (USD) -3.36 -22.83 7.09
IPOX® Japan (IPJP)** (JPY) -1.24 -13.70 1.64

* 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 (IPOM9). ** Live since 07/18. Please contact [email protected] for other IPOX® Indexes.

IPO Deal-flow Review & Outlook: PIMCO postpones its $1 billion Mortgage REIT (PMTG US) IPO, Private equity backed debt-heavy chemicals/materials maker Avantor (AVTR US) climbs on debt, Peloton Therapeutics (PLTN US) lined up. At least 9 firms debuted last week, with the average (median) equally weighted stock adding (decreasing) +6.66% (-0.59%) based on the difference between the final offering price and Friday’s close. Amid the market volatility, PIMCO postponed the largest-ever Mortgage REIT IPO. Among IPOs that pushed forward, the year’s 2nd largest deal, private equity-backed chemicals/materials maker Avantor (AVTR US: +3.57%) climbed after reducing size and pricing towards the low-end. While downsized USPS REIT Postal Realty Trust (PSTL US: -0.59%) fell, select small specialty IPOs rose strongly, including BlackRock-backed Chinese coffee chain startup Luckin Coffee (LK: +19.88%) and cloud platform developer Fastly (FSLY US: +49.94%). Abroad, UAE-based foreign exchange service provider Finablr (FIN LN: -2.29%) stumbled on its below-range London debut. Ahead of the shortened U.S. trading week, IPO activity is set to slow with three biotech small-cap IPOs lined up, including Nobel Laureate Sir Greg Winter co-founded Bicycle Therapeutics (BCYC US).  More IPO talks include Volkswagen’s TRATON truck unit, cybersecurity unicorn CrowdStrike (CRWD US), Israeli freelance marketplace startup Fiverr (FVRR US), Walmart’s British supermarket unit Asda, and discounted supermarket chain Grocery Outlet (GO US). We also note that Brazilian meat exporter Minerva Foods postponed its Chilean unit Athena Foods’ IPO due to escalating trade tensions.


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