- (1:15) – Everything You Need To Know About The ETF Market Movements: IPO Unicorns
- (8:50) – Has ESG Investing Impacted The Way Companies Conduct Themselves?
- (12:10) – Breaking Down Renaissance Capital IPO ETF: IPO
- (16:30) – What Impacts Will Rising Interest Rates Have On Stocks?
- (19:20) – Renaissance International IPO ETF: IPOS
- (23:05) – SPACs vs. ETFs: Which Is Best For Your Portfolio?
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In this episode of ETF Spotlight, I speak with Kathleen Smith, chairman and co-founder of Renaissance Capital, a global IPO investment advisory firm.
Capital markets are very hot this year. Companies around the world have raised trillions of dollars in debt and equity to take advantage of rising stock markets, and unprecedented monetary and fiscal stimulus. Money raised by US IPOs in 2021, including SPACs, is already the highest on record for any full year, per WSJ.
Most highly anticipated IPOs of the fourth quarter include electric truck maker Rivian, shoemaker Allbirds and chipmaker GlobalFoundries. Many recent IPO filings have highlighted their commitment to sustainability as ESG is one of the hottest investing trends lately.
2020 was also a blockbuster year for IPOs. Some of the newly public companies were working on coronavirus vaccines and therapeutics. Others were “new economy” companies like Zoom Video
ZM
, which benefitted immensely from the pandemic driven trends, but have been under pressure lately due to rising rates. Many of these have projected earnings in the future and higher interest rates make those earnings look less attractive.
The Renaissance IPO ETF
IPO
provides diversified exposure to newly public companies before they join other core US equity indexes. Major indexes usually include newly public companies only after a “seasoning” period. For example, Google
GOOGL
and Facebook
FB
were included in the S&P 500 index about two years after going public.
IPO ETF, which had soared in 2020, is down slightly year-to-date. Its top holdings include Moderna
MRNA
and Uber
UBER
. The Renaissance International IPO ETF
IPOS
holds recently listed international IPOs.
SPACs, which raise money from investors, only to find a private company and take it public, were very hot earlier this year. Many startups preferred going public through SPACs to avoid the cumbersome and time-consuming traditional IPO process. They were also able to avoid normal due diligence that a traditional IPO must go through. Many SPACs are now trading at deep discounts.
Tune in to the podcast to learn more about IPOs, SPACs and these ETFs.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email
[email protected]
.
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