Breaking News
Get 45% Off 0
🌊 NVIDIA ripple effect: Track AI stocks' response to chip giant's earnings
Explore AI Stocks

A Flurry Of IPOs Might Lift IPO ETF

By Zacks Investment ResearchETFsMay 14, 2015 12:32AM ET
www.investing.com/analysis/a-flurry-of-ipos-might-lift-ipo-etf-251693
A Flurry Of IPOs Might Lift IPO ETF
By Zacks Investment Research   |  May 14, 2015 12:32AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
ATYR
+2.11%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
DX
+0.18%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
TWTR
+0.00%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
FPX
+0.34%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
BABA
+3.78%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
IPO
+1.13%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

The U.S. IPO space, which was subdued at the start of 2015, looks to be on fire this week. As per Renaissance Capital, as many as 14 companies are slated to go public this week. This makes the week starting from May 4 the ‘busiest week’ of 2015 so far, per 247wallst.com.

Investors should note that after a massive run last year, the IPO market cooled down considerably in the first quarter of 2015. Per Renaissance, 34 IPOs raised $5.4 billion in capital, making Q1 of 2015 the most inactive per IPO tally since 1Q of 2013. Also, the proceeds from

IPO were the least since 3Q of 2011. Only, the health care sector managed to tread water in the gloomy U.S. IPO market
Rising rate worries, a strong dollar and later a moderation in U.S. growth have probably raised concerns over the space. However, with the Fed repeatedly hinting at a delayed rate hike, the space has now bucked up.

Companies Going Public This Week

Renaissance Capital’s IPO schedule indicated that the following companies are making a public market debut this week. These are Tallgrass Energy GP LP, Adaptimmune Therapeutics Plc (NASDAQ:ADAP), International Market Centers, Commercial Credit, Bojangles, Collegium Pharmaceutical Inc (NASDAQ:COLL), aTyr Pharma Inc (NASDAQ:LIFE), Colucid Pharmaceuticals Inc (NASDAQ:CLCD), Klox Technologies, MultiVir, Gelesis, Anterios, Htg Molecular Diagnostics Inc (NASDAQ:HTGM) and OpGen Inc (NASDAQ:OPGN).

The deal size ranges from $15 million to $900 million with OpGen having the lowest and Tallgrass Energy leading. Like Q1, the offerings are ruled by the health care and biotech space, with 10 out of 14 companies being bio-pharmaceuticals.

Looking at the trend, one can assume that the sagging scenario of Q1 in the U.S. may turn around in Q2. Things are looking better at the international arena as ample cheap money will shore up corporate activities at foreign shores.

Still, investors having faith in the revival of domestic operations might take a look at two IPO ETFs that are presently on offer. This is especially true given that the U.S. markets are now in the most active IPO week ‘since the week of July 28, 2014’, per Renaissance Capital.

Renaissance IPO (NYSE:IPO)

Holding 56 stocks in the basket, the fund follows the Renaissance IPO Index, which holds the largest and most liquid newly listed U.S. initial public offerings. New companies seek inclusion on a ‘fast entry basis’ on the fifth day of trading. Currently, the product allocates more to Alibaba (NYSE:BABA) at 9.04%, closely followed by Twitter (NYSE:TWTR) (7.46%) and Hilton (5.91%). Mid caps rule the portfolio with over half of the allocation.

IPO ETF has attracted $28 million in its asset base. The ETF sees low volume of nearly 10,000 shares, suggesting additional cost beyond the expense ratio of 0.60%. From a sector look, technology stocks make up for over one-third share followed by consumer discretionary (20%), financials (17%) and health care (10%). The fund has added 6% year to date (as of May 4, 2015).

First Trust US IPO (NYSE:FPX)

This ETF targets the U.S. IPO market and follows the IPOX-100 U.S. Index. It has accumulated $673.3 million in AUM and charges 60 bps in fees a year. Volume is decent as it exchanges around 75,000 shares in hand on average. In total, the fund holds 100 securities.

The product has a nice mix of sectors, with the top two being consumer discretionary (23.87%) and information technology (22.01%). The red hot IPO sector health care takes about 18.55% of the basket.

Since the ETF focuses on the 100 largest and most liquid U.S. IPOs, new companies can find entry into the fund’s holding after trading for a minimum of 100 days. FPX is up 7.5% so far this year (as of May 4, 2015).

Original post

A Flurry Of IPOs Might Lift IPO ETF
 

Related Articles

A Flurry Of IPOs Might Lift IPO ETF

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Apple
Continue with Google
or
Sign up with Email