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The IPOX Week (9/3/12): IPOX Records Big Relative Performance Jump !!!


The IPOX Strategies recorded big relative gains across all global regions towards month-end as major benchmarks consolidated and China-linked exposure slumped anew. No significant IPOs priced, traded and upcoming. Japan Airlines (9201 JP) sets indicative price range for massive re-IPO.


· Key IPOX Strategies record big relative gains across all of the IPOX universe:Despite strong declines in over weighted China-linked exposure, the IPOX Global 50 (IPGL50), fell just -0.24% to +13.00% YTD on the week, outperforming benchmark MSCI World (MXWD) by another +44 bps to +544 bps. YTD. The IPOX Global 50 (IPGL50), key gauge for the performance of the largest and most successful global IPOs and spin-offs over a four-year rotational cycle, benefited from a great relative week in the IPOX U.S. (IPXO, IPXT), IPOX Europe (IXTE, IPXUJPEU) and IPOX Asia-Pacific (IPTA) universe. Through modified stock selection, the IPOX Strategies remained unaffected by the continued slump in social networker Facebook (FB: -6.96%) or H.K. jeweler Chow Tai Fook (-6.55%). The most recent key global IPO, hospital operator IHH Health Care (IHH MK: +2.56%) rose to near a post-IPO high after good earnings. Within the IPOX Regional universe (IPXO, IPXT), the IPOX U.S. 100 (ETF: FPX) was the best performing U.S. benchmark, gaining +0.83% to +17.19% YTD on strength the IPOX heavyweights, including car maker General Motors (GM: +0.80%), credit card processor Visa (V: +1.26%) and Buffett-backed stocks, including discount retailer Dollar General (DG: +2.84%), refiners Phillips 66 (PSX:+1.55%) and Marathon Petroleum (MPC: +6.15%) At the same time, the narrower and large-cap centric IPOX U.S. 30 (IPXT) recovered strongly, gaining +11 bps. vs. the IPOX U.S. 100 (IPXO) to +16.34% YTD. The IPOX Europe universe (IXTE, IPXUJPEU) rose anew, with the broad IPOX Europe 50 (IPXUJPEU: +0.50%) beating benchmark Stoxx 50 (SX5P: -0.96%). A big rise in global miner and IPOX heavyweight Glencore International (GLEN LN: +5.20%) on Qatar/Xstrata helped. Spanish exposure rose, with embattled Financial Bankia (+13.17%) in focus. Specialty IT Spanish travel reservation systems operator USD 9.8bn Amadeus IT Holdings (AMS SM: +2.66%) gained to levels not seen since pricing a private placement of 6.7% of its shares outstanding three weeks ago. Across the developed Asia-Pacific universe, the IPOX Asia-Pacific 30 (IPTA) extended the relative gains to a 5th consecutive week with the index spread vs. benchmark MSCI Asia-Pacific (MXPC) rising by a +140 bps. to a massive +1349 bps. YTD, underlying yet again the asset allocation potential of Asia-ex China aftermarket IPO/spin-off investing. Weakness across the high-beta H.K. traded casino group Wynn Macau (1128 HK: -5.92%) and embattled IPOX heavyweight Financial Dai-Ichi Life (8750 JP: -7.00%) was mitigated by a good relative week in Singapore's CapitaMalls (CMA SP: +0.30%), USD 19.2bn fashion group Prada (1913 HK: +3.02%) or semi-conductor maker Avago Technologies (AVGO: +1.44%). Japan's snack food maker USD 2.5bn Calbee (2229 JP: +5.63%) rose to a new post-IPO high. Mainland China markets remained under pressure with the Shanghai Composite (SHCOMP: -2.13% to -6.91% YTD) falling for another week on continued gloom over domestic economic prospects. China-linked IPOX exposure slumped as a consequence, but outperformed the benchmark for a second week in a row. For example, the IPOX China 20 (CNI: -3.56%) rose +52 to +0.91 bps YTD. vs. benchmark HSCEI Enterprise (HSCEI: -4.08%). Financials linked to the Chinese mainland suffered most, with USD 5.6bn Evergrande Real Estate Group (3333 HK: -10.03%) and heavyweight Agricultural Bank of China (1288 HK: -6.84%) in focus. Interesting is the resilience of the two latest U.S. traded China-IPOs with small-caps including consulting firm Acquity Group (AQ US: +7.86%) and online retailer VipShop (VIPS US: +20.48%) recording a big week.

· IPOX Long-only Strategy Returns YTD 2012:

Ticker (BBG/Reuters) Week Q2 12 YTD 12
IPOX Global 50 (IPGL50) (NYSEARCA:USD) -0.24% -8.13% +13.00%
MSCI World (MXWD) -0.68% -6.35% +7.56%
IPOX U.S. 100 (IPXO +0.83% -5.23% +17.19%
IPOX U.S. 30 (IPXT) +0.94% -3.67% +16.34%
S&P 500 (SPX) -0.32% -3.29% +11.85%
IPOX Europe50 (IPXUJPEU) (EUR) +0.50% -10.75% +2.56%
IPOX Europe30 (IXTE) (EUR) +0.80% -12.33% -1.05%
STOXX 50 (SX5P) (EUR) -0.96% -3.16% +5.88%
IPOX Asia-Pacific 30 (IPTA) -0.86% -5.69% +16.55%
MSCI Asia-Pacific (MXPC) -2.26% -6.89% +2.94%
IPOX China 20 (NYSE:CNI) -3.56% -8.97% -5.79%
Hang Seng Enprs. (HSCEI) -4.08% -10.12% -6.60%

Why choose IPOX to close the IPO/spin-off asset allocation gap?
§ Proven: Real-time performance over market cycles

§ Scalable and Stable: Clearly defined Philosophy

§ Patented: Index Technology

§ Best in Practice: Support and Research

· Most significant IPOs traded (Week 08/27/12):

Company Ticker Return / IPO (%)
No significant IPOs priced and traded

No significant IPOs priced and commenced traded during the last week.

· Book Building in Japan Airlines (9201 JP) starts:

Company Code Country Lead
No significant IPOs expected to priced and trade

No significant global IPOs are lined up for the upcoming week. In what promises to be an active Q4 for global IPOs, Japan Airlines (9201 JP) starts book-building for its massive max. USD 8.44bn IPO at a tight indicative price range of JPY 3500- JPY3790. Amid a big valuation discount to its peer (9202 JP), all proceeds of the GM-style (GM: +0.80%) re-IPO go to the government, which bailed out the firm in 2010.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.