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IPO ETF (FPX) Hits New 52-Week High

Sweta Killa
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For investors seeking momentum, First Trust US Equity Opportunities ETF FPX is probably on radar now. The fund just hit a 52-week high, and is up 26.7% from its 52-week low price of $54.00/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

FPX in Focus    

This fund focuses on the largest, best-performing and most-liquid U.S. IPOs. New companies can find entry into the fund’s holding after trading for a minimum of 100 days. It holds 100 securities in its basket with key holdings in information technology, consumer discretionary, health care and consumer staples sectors. The product charges 60 bps in annual fees from investors (see: all the Total U.S. Market ETFs here).

Why the Move?

The IPO corner of the broad investing world has been an area to watch lately given that it has made a strong comeback in 2017, after two years of declining trend. Global IPOs raised $141 billion over the course of the year, up 33% from the 2016 subdued levels of $106.3 billion and above the $138 billion 10-year median, as per IPO research intelligence Renaissance Capital. The upsurge were credited to a surging stock market, improving economic fundamentals and increasing consumer sentiment that led to the appeal for new stocks with high growth potential.

More Gains Ahead?

It seems that FPX might remain strong given a high weighted alpha of 26.80% and a low 20-day volatility of 9.30%. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.

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FT-IPOX 100 (FPX): ETF Research Reports
 
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