Another choice is the Renaissance IPO ETF (IPO). The current $7.5 billion average weighted market size of companies held inside this fund is much smaller compared to FPX. Also, its portfolio of 71 stocks is more concentrated, and roughly 10 percent of its exposure is to international stocks.
While some of 2019’s IPO class of high-profile names have struggled performance-wise, IPO-related ETFs have delivered impressive results. The First Trust fund is up 18.6 percent and the Renaissance IPO ETF is up 27.8 percent this year, respectively.
Today’s IPO market has undergone major changes and is dramatically different compared to previous eras. Like any market, it faces major obstacles and challenges for investors. Yet, while the sizzle may be less compared to the past, the hope of finding a gem never dies.
Ron DeLegge is founder and chief portfolio strategist at ETFguide.