The IPOX® Week, November 16th, 2020

  • IPOX Indexes lag as investors flock to underperforming global benchmark exposure.
  • Big gain in specialty stocks drives IPOX China Core (CNI) to fresh all-time high.
  • SPACs have good week as IPOX SPAC (SPAC) gains +2.84%.
  • Little deal flow lined up. Several high-profile deals near launch.

IPOX Indexes lag as investors flock to underperforming global benchmark exposure. Amid Covid-19 anxiety tempered by positive vaccine developments and U.S. election news, VALUE reset sharply vs. GROWTH last week across the global regions, leaving most IPOX Indexes significantly lagging their benchmarks. After trading at a fresh all-time high at the previous week’s close, e.g., the IPOX 100 U.S. (IPXO), underlying for the $2 billion “FPX” ETF, shed -3.79% to +29.24% YTD, +1927 bps. YTD ahead of the S&P 500 (SPX), benchmark for U.S. stocks. Losses extended to non-U.S. domiciled exposure traded in the IPOX International (IPXI), tracked by the $0.5 billion “FPXI” ETF. Here, explosive gains in specialty holdings mitigated the negative impact of big profit taking amongst

IPOX® International ETF (Ticker: FPXI) since Launch

European exposure, e.g., with the portfolio declining by -1.27% to +52.86% YTD. Increasing regulatory overhang which particularly pressured hedge-fund heavy Chinese ecommerce behemoth Alibaba (BABA US: -13.04%) throughout last week did little to derail the positive momentum in the IPOX China Core (CNI) with great earnings in select holdings driving the diversified index by +1.12% to +69.68% YTD towards Friday’s U.S. close, a fresh all-time high. In individual IPOX portfolio holdings, we note a huge week for Japan-domiciled AI Inside (4488 JP), a provider of AI solutions for businesses in Japan. The 12/2019 IPO, a member of the IPOX International (ETF: FPXI), rose +39.08% after a blow-out quarterly report, extending its YTD gain to a massive +644.63%. Earnings also propelled Chinese ecommerce platform Pinduoduo (PDD US: +32.10%) to its best two-week gain since its 2018 IPO. Profit taking in stay-at-home stocks after the big run-up pressured a number of constituents, including online collaboration services provider Zoom Video (ZM US: -19.30%), electronic signature software maker DocuSign (DOCU US: -11.22%), German online food services provider HelloFresh (HFG GY: -10.94%) and U.S. social networker Snap (SNAP US: -10.91%).

Select IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) -2.46 27.93 51.47
IPOX® International (IPXI)* (USD) (ETF: FPXI) -1.27 31.37 52.86
IPOX® Indexes: United States
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) -3.79 29.60 29.24
IPOX® ESG (IPXT) (USD) -2.05
IPOX® SPAC (SPAC) (USD) 2.84
IPOX® Indexes: Europe/Nordic
IPOX® 100 Europe (IPOE)* (USD) -2.31 30.97 20.22
IPOX® Nordic (IPND) -3.85 38.52 41.54
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) -0.25 4.41 41.33
IPOX® China (CNI) (USD) 1.12 26.31 69.68
IPOX® Japan (IPJP)** (JPY) 0.57 37.91 24.95

* 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 %):
AI INSIDE INC 39.08 PALOMAR HOLDINGS INC -23.28
TRAINLINE PLC 37.85 BEYOND MEAT INC -20.48
PINDUODUO INC 32.10 PELOTON INTERACTIVE -19.66
CARDLYTICS INC 23.88 ZOOM VIDEO -19.30
DENALI THERAPEUTICS 20.15 STILLFRONT GROUP AB -16.93
WIZZ AIR HOLDINGS PLC 19.33 DUCK CREEK TECH -16.28
ZAI LAB LTD 17.55 BIGCOMMERCE -15.99

IPO Deal-flow Review and Outlook: 6 firms IPO’d across the global regions last week, with the average (median) equally weighted deal adding +28.25% (+5.57%) based on the final offer price and respective close. With the U.S. market quiet, focus was on listings abroad such as Korean restaurant chain Kyochon F&B (339770 KS: +139.43%), Brazilian online thrift shop Enjoei (ENJU3 BZ: -9.37%) and wind turbine blades maker Aeris (AERI3 BZ: +9.91%). More U.S. deals are lined up for this week, including lab services firm Sotera Health (SHC US) and biotech research product provider Maravai LifeSciences (MRVI US), both set to raise above $1 billion, as well as several IPOs in the Hong Kong market. Other IPO news include: 1) long-awaited food delivery platform DoorDash files for IPO; 2) multiple high-profile deals set to launch include European phone tower operator Vodafone, Blackstone-backed dating app Bumble, Macquarie-backed Australian security software developer Nuix, grocery deliver unicorn Instacart, JD.com telehealth unit spin-off JD Health, Italian aerospace manufacture Leonardo’s U.S. defense unit DRS, and EQT-held pest control firm Anticimex.

IPOX® SPAC Index (SPAC) update: The Index added +2.84% to +7.90% since its July 30 launch. SPAC news include 1) 2 SPACs Announced Acquisition Targets: a) Jaws Acquisition with senior-care delivery platform Cano Health; b) Tuscan Holdings with EV battery maker Microvast; 2) 8 new SPACs IPO’d.

Track global deal flow live on: https://bit.ly/32zolmG

Lightspeed Financial Services Group LLC is not affiliated with these third-party market commentators/educators or service providers. Data, information, and material (“content”) are provided for informational and educational purposes only. This content neither is, nor should be construed as an offer, solicitation, or recommendation to buy or sell any securities or contracts. Any investment decisions made by the user through the use of such content is solely based on the users independent analysis taking into consideration your financial circumstances, investment objectives, and risk tolerance. Lightspeed Financial Services Group LLC does not endorse, offer nor recommend any of the services or commentary provided by any of the market commentators/educators or service providers and any information used to execute any trading strategies are solely based on the independent analysis of the user.

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