The IPOX® Week, November 2nd, 2020

  • IPOX Indexes trade mixed during October and outperform. Reflective of COVID-19 severity, E.U. & U.S. lag Asia-Pacific.
  • IPOX China (CNI) leads IPOX Indexes rankings with +4.99% gain during last month. ETF in focus: FPXI.
  • Ant Group (6688 HK) lined up for dual Shanghai/Hong Kong listing for 11/5, world’s largest. IPO sentiment deteriorates towards month-end as Chinese fintech Lufax (LU US) drops.

IPOX Indexes trade mixed during October and outperform. Reflective of COVID-19 severity, E.U. & U.S. lag Asia-Pacific. Amid the background of 1) heightened COVID-19 severity across Europe & the U.S., 2) notable gains in equity risk (VIX: +44.18%) and U.S. yields and 3) generally solid earnings, the IPOX® Indexes traded mixed last month and outperformed the benchmarks. Ahead of the U.S. election, e.g., the IPOX 100 U.S. (ETF: FPX) shed -1.10% to +18.95% YTD, leading the S&P 500 (SPX) by +167 bps. on the month. Relative strength extended to non-U.S. domiciled IPOX exposure, with the IPOX International (ETF: FPXI) extending the relative performance lead vs. its benchmark by +352 bps. to a massive +5276 bps. YTD. Big gains in specialty exposure across outperforming Asia-Pacific-traded holdings drove the good showing,

IPOX® International (ETF: FPXI) since Launch:

including IPOX heavyweight’s e-commerce behemoths Meituan (3690 HK: +19.19%) and Pinduoduo (PDD US: +21.35%), as well as JP-traded AI software maker AI Inside (4488 JP: +32.35%) and statistics compiler JMDC (4483 JP: +18.57%). We note significant declines in select global payment processors, including U.S.-traded IPO M&A Fidelity National (FIS US: -15.37%) and Europe’s Adyen (ADYEN NA: -7.95%) and Nexi (NEXI IM: -22.96%), while IPOX-held social networkers Snap (SNAP US: +50.86%) and Pinterest (PINS US: +42.01%) surged after reporting exploding user numbers, while former IPOX holding Twitter (TWTR US: -7.06%) sank.

IPOX® SPAC Index (SPAC): The Index fell -10.37% to +2.07% since its July 30 launch. SPAC news include 1) 3 SPACs Completed Mergers: a) Spartan Energy with EV maker Fisker (FSR); b) ARYA Sciences II with neuroscience drug developer Cerevel Therapeutics (CERE); c) DiamondPeak with EV truck maker Lordstown Motors (RIDE) 2) 2 SPACs Announced Acquisition Targets: a) Alberton Acquisition with solar energy company SolarMax; and b) dMY Technology II with British betting firm Genius Sports Group.

Select IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) -0.11 27.93 39.46
IPOX® International (IPXI)* (USD) (ETF: FPXI) -0.49 31.37 40.16
IPOX® Indexes: United States
IPOX® Composite U.S. (IPXC) -2.42 29.60 17.01
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) -1.10 29.60 18.95
IPOX® ESG (IPXT) (USD) -2.56
IPOX® SPAC (SPAC) (USD) -10.37
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) -2.11 34.55 19.04
IPOX® Nordic (IPND) -0.30 38.52 36.09
IPOX® 100 Europe (IPOE)* (USD) -3.51 30.97 10.88
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 0.30 4.41 31.68
IPOX® China (CNI) (USD) 4.99 26.31 54.42
IPOX® Japan (IPJP)** (JPY) 0.31 37.91 16.90

* 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 Month in %):
MYOKARDIA INC 63.96 DRAFTKINGS INC -39.84
SNAP INC 50.86 FASTLY INC – CLASS A -32.21
PINTEREST INC 42.01 SWEDISH ORPHAN -29.07
GOOSEHEAD INSURANCE 41.52 KOOLEARN TEC -24.32
AI INSIDE INC 32.35 TRAINLINE PLC -24.24
CLOUDFLARE INC 26.57 SMILEDIRECTCLUB INC -23.80
BIONTECH SE 23.30 NEXI SPA -22.96
PINDUODUO INC 21.35 MORPHOSYS AG -19.94
DENALI THERAPEUTICS 19.40 PEXIP HOLDING ASA -19.56
MEITUAN DIANPING 19.19 ADT INC -19.34
BIOHAVEN PHARMA 19.15 POWERLONG COMM -18.50
JMDC INC 18.57 NEW FORTRESS ENERGY -17.91
ONCOPEPTIDES AB 18.53 CARVANA CO -16.91

IPO Deal-flow Review and Outlook: At least 31 firms IPO’d across the global markets last week, with the average (median) equally weighted deal adding +2.48% (0.00%) based on the final offer price and respective close. Performances diverged widely in the U.S.: While Ping An backed fintech unicorn Lufax (LU US: -4.81%) and Ohio-based car insurtech Root (ROOT US: -11.22%) stumbled, pool maker Leslie’s (LESL US: +29.24%) and advertising firm MediaAlpha (MAX US: +76.26%) rose. Abroad, Spanish renewable energy firm Soltec Power (SOL SM: +11.62%) gained, while Philippines biggest IPO in four years, broadband operator Coverage ICT Solutions (CNVRG PM: -12.02%), disappointed. Mortgage company AmeriHome and Caliber both postponed planned offerings due to volatile market conditions. Despite concerns over rising geopolitical risk and U.S. Election Day, all eyes are on Alibaba’s fintech unit Ant Group (6688 HK)’s record-breaking debut. The A+H shares dual offering values the Chinese unicorn at over $320B. Shares will begin trading in HK on 11/5/2020. Other IPO news include: 1) Airbnb continues to push forward IPO progress; 2) WeWork eyeing IPO again.

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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