One of the best ways to invest in an IPO is by not investing in an IPO.
Through June, about 70 IPOs came to market, marking a 32.7% year over year increase, as noted by Renaissance Capital. Total proceeds hit $16.7 billion, which was up 87.3% year over year. Helping, we’re seeing even more artificial intelligence IPOs hit the market, such as Tempus AI. Even AI chipmaker Cerebras just filed for an IPO.
And while you can always take your chances with a bet on an IPO, keep reading to find out an easier way…
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ETF: First Trust US Equity Opportunities ETF (SYM: FPX) With an expense ratio of 0.59%, the FPX tracks hot IPOs, giving investors access to new stocks during their initial, most crucial days on market. By buying it, not only can you avoid paying gobs of money for IPOs that may or may not work out, but you’re also being exposed to multiple hot IPOs at the same time at lesser cost. In fact, even with some of the most obnoxious IPO failures, the ETF managed to run from a 2009 low of around $11 to a recent high of $113.57. It’s a safer alternative than risking your hard-earned money to another potential flop, as SNAP-like stocks turned out to be. With the FPX, it doesn’t matter if the stock is hot or a dud, the excitement surrounding IPOs continues to send the FPX to new highs. |
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ETF: Renaissance IPO ETF (SYM: IPO) With an expense ratio of 0.6%, the ETF provides “investors with the largest, most liquid US-listed newly public company stocks in one security, reducing the risk of single-stock ownership while avoiding overlap with major core indices for optimal diversification across markets and time,” as noted by Renaissance Capital. Some of its current holdings include Arm Holdings, Nu Holdings, Kenvue, CAVA Group, Instacart, Braze, Nextracker and Reddit to name a few of the top ones. While the IPO ETF is a bit overbought and likely to see some profit taking, we do expect for it to race to higher highs over the long. Term. Since November 2023, the ETF rallied from a low of about $30 to its current price of $43.76. From here, we’d eventually like to see the ETF rally back to $60 a share, which it last tested in 2022. |
InvestorPlace Media
Warren Buffett, Jeff Bezos, Michael Bloomberg, & 48 Members of Congress Are Buying ONE Sector…
Why are Warren Buffett, Jeff Bezos, Michael Bloomberg, “The Walmart Family”, Bill Gates, and 48 members of Congress shifting their stocks in a frenzy?
Their disruptive $martphone, has helped users earn and save $325M+ through simple, everyday use. That led to 32,481% revenue growth between 2019 and 2022 and presence in 170+ countries.
And why are they all piling into ONE unique corner of the market…
The last time we saw the world’s wealthiest investors move their cash into this corner of the market, Stocks exploded 2,020%, 5,609% Even as high as 8,437% in just ONE year. Now, it’s all happening again.
