LONDON--(BUSINESS WIRE)--First Trust Global Portfolios Limited (“FTGP”), a London-based ETF distributor and advisor, announced that it has launched the First Trust US IPO Index UCITS ETF (the “Fund”). The Fund began trading on the Euronext Paris on 17 August 2015 (Ticker: FPXU FP) and on the London Stock Exchange on 18 August 2015 (Ticker: FPX LN).
The Fund is based on the IPOX®-100 U.S. Index (the “Index”). The Index is a rules based, modified value-weighted price index measuring the performance of the top 100 U.S.-domiciled companies ranked quarterly by market capitalisation in the IPOX® Global Composite Index. The Index measures the average performance of U.S. public offerings (“IPOs”) during the first 1000 trading days. Index constituents are selected based on quantitative initial screens. The Fund only tracks recent IPOs and spin-offs. Therefore, there is very little overlap with traditional index funds, which generally have a waiting period before adding IPOs/spin-offs. As a result, a portfolio of recent IPOs may complement a core equity holding by providing more complete exposure to the total equity market. “We’re pleased to extend our relationship with First Trust Portfolios to help European investors gain exposure to U.S. IPOs and Spin-offs via our benchmark IPOX®-100 U.S. Index,” said Josef Schuster, Founder of IPOX Schuster LLC. As at 31 July 2015, the Index had a market capitalisation of approximately $1.3 trillion USD.
It is common for the closing market share price shortly after the IPO to be well above or below the initial offering price and it is difficult to predict which IPOs will be successful. Often the motivation to invest in an IPO is the potential to receive a short-term gain, regardless of a stock’s longer-term potential for success or failure. The Index takes a different approach. Constituents may be added to the Index on the sixth day of public trading; and therefore, the Fund may not have access to the gains derived from the initial run-up in an IPO’s price. However, there is a case to be made for investing in a diversified portfolio of recent IPOs and spinoffs beyond potentially participating in an unusually large return from a stock’s initial day of trading.
The launch of the First Trust US IPO Index UCITS ETF offers European investors a unique opportunity to participate in the vibrant U.S. IPO and spin-off market. Since its inception on 6 August 2004 through 30 June 2015, the IPOX®-100 U.S. Index had an average annual total return of 16.99% versus 8.97% for the Russell 3000® Index (more details set out below). However, past performance is not a reliable indicator of future results and it is not possible to invest directly in an index. Actual performance of the Fund may be materially lower than that of the Index.
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Percentage Growth* |
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07/14- |
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07/11- |
07/10- |
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08/06/04- |
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IPOX®-100 |
14.71% | 36.00% | 34.44% | 7.17% | 39.16% | 20.99% | -30.93% | -4.32% | 28.07% | 18.83% | 45.36% | ||||||||||||||||||||||
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Russell 3000® |
7.29% | 25.22% | 21.46% | 3.84% | 32.37% | 15.72% | -26.56% | -12.69% | 20.07% | 9.56% | 16.55% | ||||||||||||||||||||||
| *Source: Bloomberg. The opening value on 1 July is calculated based on the end closing value of the preceding business day. | |||||||||||||||||||||||||||||||||
| *Currency: USD. Fund performance relative to the above may rise or fall due to currency fluctuations. | |||||||||||||||||||||||||||||||||
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**The Russell 3000® Index is comprised of the 3000 largest and most liquid stocks based and traded in the U.S. |
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For more information, please contact Derek Fulton at +44(0) 203 195 7125 or dfulton@ftgportfolios.com.
About First Trust Global Portfolios
FTGP was established in December 2011 as a UK-based and UK FCA regulated distributor and advisor. FTGP is an affiliate of First Trust Advisors L.P. and First Trust Portfolios L.P. (collectively “First Trust”). FTGP distributes and markets a range of First Trust U.S. registered ETFs and Irish domiciled UCITS funds under the First Trust Global Funds PLC umbrella. The ETFs have been notified to the UK FCA under Article 42 of the EU’s Alternative Investment Management Directive. First Trust Advisors L.P. is the investment manager of the UCITS ETFs. First Trust is a privately owned U.S.-based financial services firm and is a provider of exchange-traded funds in the U.S. marketplace. First Trust has total assets under management or supervision in excess of $118 billion as at 31 July 2015. For more information, visit http://www.ftglobalportfolios.com.
Risks
The Fund’s shares may change in value and may go down as well as up. You could lose money by investing in the Fund. You may not get back all the money you invest.
The Fund is subject to Market Risk, which means that Shares of the Fund may fall in value due to market fluctuations caused by such factors as economic, political, regulatory or market developments, changes in interest rates and perceived trends in securities prices.
There may be tracking difference between the Fund and the underlying index due to the impact of the annual Fund management fees. Therefore the Fund’s return may not match the return of the IPOX®-100 U.S. Index.
The Fund’s holdings may be issued by companies concentrated in a particular industry or country.
The Fund may invest in small capitalisation and mid capitalisation companies. Such companies may experience greater price volatility than larger, more established companies.
As the Fund’s investments may be denominated in currencies other than the Fund’s currency, an investment in this Fund may expose you to currency risk.
This Fund’s Net Asset Value (NAV) is likely to have high volatility due to the portfolio composition and/or the index replication technique. As such, potential investors should be aware that the Fund’s shares will change in value, and may do so in a volatile fashion; potential investors could lose money by investing in the Fund.
Neither FTGP nor any of its affiliates guarantees the performance or the future returns of the Fund.
For more details relating to risks of investing in the Fund, please refer to the “Risk Factors” section of the Fund’s prospectus.
Important Information
This financial promotion is issued by FTGP of 8 Angel Court, London, EC2R7HJ. FTGP is authorised and regulated by the UK Financial Conduct Authority (register no. 583261). Nothing in this document constitutes an invitation, offer, solicitation or recommendation to engage in any investment activity including buying or selling any investment including any interest in the Fund.
The Fund is an open-ended sub-fund of the First Trust Global Funds PLC (the “Company”), an umbrella UCITS fund with segregated liability between sub-funds, incorporated with limited liability as an investment company with variable capital under the laws of Ireland with UCITS registered number 514357. The Company is a recognised collective investment scheme (a “recognised scheme”) for the purposes of section 264 of the Financial Services and Markets Act 2000 (“FSMA”) of the United Kingdom. The Fund is not regulated by the FCA. Most of the protections provided by the UK regulatory system do not apply to the operation of the Fund and compensation will not be available under the UK Financial Services Compensation Scheme on its default.
An investment in the Fund is speculative and may not be appropriate for all potential investors. FTGP does not guarantee the performance of the shares of the Fund. The value of an investment and income from it can go down as well as up and may be affected by exchange rate variations. Investors may not get back the amount invested or lose their entire investment. Current tax levels and reliefs will depend on the nature of the holdings. Past performance is not a guide to future performance.
The material in this document is not comprehensive and must therefore be read in conjunction with the Fund’s Prospectus, which contains material information not contained herein, including the terms of investment and information regarding investment risks and restrictions, fees and expenses and conflicts of interests. Potential investors should pay particular attention to the risk disclosures in the Prospectus. No assurance can be given that the Fund’s investment objective will be achieved or that the Fund will generate a positive return. Contact FTGP or visit www.ftglobalportfolios.com to obtain a Prospectus and/or Key Investor Information Document (available in English). Potential investors should conduct their own investigation and analysis of the Fund and consult its/their own professional tax, accounting, financial or other advisors as to the risks involved in making an investment. Potential investors should consider the Fund’s investment objectives, risk, charges and expenses carefully before investing.
Nothing contained herein constitutes investment, legal, tax or other advice nor is it to be solely relied on in making an investment or other decision. It is not an invitation to make an investment in the Fund nor does the information, recommendations or opinions expressed herein constitute an offer for sale of the Fund.
Shares of the Fund are not available for sale in any state or jurisdiction in which such sale would be prohibited. The shares of the Fund have not been registered under the US Securities Act of 1933, as amended, and the Fund is not registered under the US Investment Company Act of 1940, as amended. Neither this material nor the Fund’s shares are available to or suitable for US persons.
Whilst every effort is made to ensure the accuracy of this information, no representation or warranty stated or implied is made or given by any persons as to the accuracy or completeness of the information contained in this document and no responsibility or liability is accepted for such information or opinion.
A patent with respect to the IPOX® index methodology has been issued (U.S. Pat. No. 7,698,197). IPOX® is a registered international trademark of IPOX® Schuster LLC (www.ipoxschuster.com).
