Renaissance International IPO ETF recently changed its Morningstar Category. The Morningstar Category is the peer group used to determine an investment's relative merits. In this case, the move has led to this strategy's Morningstar Medalist Rating being downgraded to Negative from Neutral. The portfolio maintains a cost advantage over competitors, priced within the cheapest fee quintile among peers. The strategy changed its peer group last October, moving from the Foreign Small/Mid Growth category to the Foreign Large Growth Morningstar Category. 

 The strategy earns a Low Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in volatility exposure and an underweight in liquidity exposure compared with category peers. High volatility exposure is attributed to companies with a higher standard deviation of returns. And a low liquidity exposure is rooted in stocks with lower trading volumes, limiting managers' flexibility. The team managing this passive strategy earns a Low People Pillar rating. The strategy's parent organization doesn't stand out, earning the firm an Average Parent Pillar rating. It has displayed a handful of investor-friendly attributes including overall reasonable fees but is held back by a bench of limited-tenure portfolio managers.

Analyst Rating

ALLETE

Spirit Airlines

Varian Medical Systems

Osisko Gold Royalties

Tortoise Power and Energy Infrastructure Fund

AutoWeb

Pendrell

Doximity

Western Asset Corporate Loan Fund Inc

Aris Water Solution

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. Renaissance International IPO ETF earns a Low Process Pillar rating. The main driver of the rating is the fund's mediocre long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category index, which suggests that the process has struggled over that period. Management team experience, which averages three years at this fund, also weakens the process. The parent firm's five-year risk-adjusted success ratio of 0% further detracts from the process. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's relatively low success ratio suggests that the firm could do better across its fund lineup.

The investment strategy as stated in the fund's prospectus is:  The investment seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Renaissance International IPO Index.  The fund normally invests at least 80% of its total assets in securities that comprise the index. The index is comprised of common stocks, depositary receipts, real estate investment trusts ("REITs") and partnership units. The fund may also invest up to 20% of its assets in certain futures, options, and swap contracts, cash and cash equivalents, and as well as in common stocks not included in the index but which will help the fund track the index. It is non-diversified. 

 The portfolio is overweight in communication services and real estate relative to the category average by 6.5 and 4.8 percentage points, respectively. The sectors with low exposure compared to category peers are industrials and consumer defensive, underweight the average by 7.7 and 5.4 percentage points of assets, respectively. The strategy owns 62 securities and is relatively top-heavy. Of the strategy's assets, 47.6% are concentrated within the top 10 holdings, compared to the typical peer's 16.9%.

Process

Renaissance Capital’s team earns a Low People Pillar rating. The number one detractor from the rating is the turnover of management across its parent firm. The firm's asset-weighted manager tenure of three years suggests it could do more to retain portfolio managers. Management team experience, which averages three years at this fund, also holds the rating back. The parent firm's subpar risk-adjusted performance, as shown by its average overall Morningstar Rating of 1.0 stars, detracts from the rating as well. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis.

People

Renaissance Capital's track record as a steward is mixed, leading to an Average Parent Pillar rating. An area of strength is the firm’s favorable fees for open-end and exchange-traded funds, demonstrating a firm-wide commitment to minimizing costs and maximizing investors’ returns. Fees for funds are, on average, within the lowest quintile of similarly distributed strategies. Only three years of average tenure among Renaissance Capital's longest-tenured managers gives us pause. In isolation, seasoned teams tend to have more experience to draw upon should they need to navigate turbulent market conditions. With an average three-year Morningstar Rating of 1.0 stars, the risk-adjusted performance of Renaissance Capital's open-end and exchange-traded funds falls short of competitors.

Average

Parent

Renaissance International IPO ETF

IPOS tracks a cap-weighted index of recent IPOs listed internationally. The fund adds an IPO within 90 days of its initial listing.

Alpha Technology Group Ltd

Hamilton Insurance Group Ltd

Renaissance IPO ETF

Kenvue

Lexeo Therapeutics Inc

Navigant Consulting

Pineapple Financial Inc

Palantir Technologies

Shimmick Corp

Two IPOs are currently scheduled for the week ahead, although some small issuers may join the calendar late. As of 11/2/2023, the Renaissance IPO Index was up 23.5% year-to-date, while the S&P 500 was up 14.0%. Renaissance Capital's IPO ETF tracks Renaissance IPO Index, and top ETF holdings include Palantir Technologies and Kenvue.

U.S. IPO Weekly Recap: Biotech Lexeo Stumbles After $100 Million IPO

First Trust US Equity Opportunities ETF

September is already looking like an eventful month for initial public offerings. While Arm IPO already became successful, Instacart's scheduled entry may also turn out to be strong.

IPO ETFs Look Hot in September: Here's Why

ARM Holdings PLC

Instacart (Maplebear Inc.)

Credo Technology Group Holding Ltd

Samsara

Klaviyo, Inc. 

The strong debut of Arm Holdings Plc. is expected to reignite the long-dormant IPO market for tech companies, but not all the current deals in the pipeline will have the same draw for investors.

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Airbnb

Adlai Nortye Ltd

Inspire Veterinary Partners Inc

Snowflake

Gamer Pakistan Inc

There was just one pricing this past week, which was excluded from our IPO stats, while holdover biotech Adlai Nortye did not get done. Filing activity reached a six-month high in August, and six issuers filed to raise $100 million or more, the most since January. Veterinary hospital operator Inspire Veterinary Partners priced at the low end to raise $6 million at a $41 million market cap.

U.S. IPO Weekly Recap: August Wraps Up With 1 Nano-Cap

Advisorshares Restaurant ETF

iShares Global Industrials ETF

iShares Global Tech ETF

iShares U.S. Industrials ETF

There is renewed optimism in the initial public offering (IPO) market.

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Atmus Filtration Technologies Inc

Azitra Inc

CaliberCos Inc

FG Group Holdings Inc.

Porsche Automobil Holding SE

Strong Global Entertainment Inc

Cava Group, Inc.

Two small deals priced this past week, neither of which were eligible for inclusion in our IPO stats, while one issuer delayed to the week ahead. The week's news was driven by Cummins spin-off Atmus Filtration, which launched its $275 million IPO, and restaurant chain CAVA Group, which filed to raise $100 million.

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Black Spade Acquisition Co

VinFast Auto Ltd

No IPOs began trading or submitted initial filings this past week, as the sole scheduled deal, Strong Global Entertainment, was delayed to the week ahead. Vietnamese EV maker, VinFast, announced plans to merge with SPAC Black Spade Acquisition.

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ACELYRIN Inc

Alchemy Investments Acquisition Corp 1

Golden Star Acquisition Corp

Webuy Global Ltd

The month of May started off with two large IPOs, Kenvue and ACELYRIN. Two blank check IPOs also priced this past week.

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Invesco S&P 500 Top 50 ETF

Although the IPO market is currently stagnant, there is still an anticipation of a gradual increase in activity in the near future, especially in summer months, per Renaissance Capital.

Rough Global IPO Market: Implications for ETF Investors

Defiance Next Gen SPAC Derived ETF

SPAC and New Issue ETF

Poor market conditions effectively shut down the U.S. IPO (initial public offering) market in 2022. We analyzed previous IPO droughts (2003 and 2008) to assess when the market may rebound.

Searching For Momentum In The IPO Drought

Cummins

Intchains Group Ltd

Phoenix Motor Inc

SPI Energy

The IPO market was quieter than expected this past week. Both deals on the calendar delayed, and there was no wave of post-Presidents' Day launches. With no large post-Presidents' Day launches this past week, six small companies are scheduled to list in the week ahead.

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After a record year, the global market for initial public offerings IPO was off in 2022. IPO activity is not likely to recoil much in the first half of 2023.

Global IPOs Less Likely to Rebound in 2023: ETFs in Focus

U.S. IPO ETF underperformed massively in 2022 while international IPO ETF too lost about 30% this year.

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Volkswagen AG, on Sep 5. announced that it would float its celebrated sports car maker, Porsche Automobil Holding SE, in what could be one of Europe's largest initial public offering.

Porsche's IPO Plan Puts These ETFs in Focus

The Arena Group Holdings

Heartcore Enterprises

Modular Medical

TC Biopharm Holdings PLC

Uber

The Arena Group, a media holding company operating Sports Illustrated, TheStreet, and other brands, raised $30 million at a $172 million market cap. Nine SPACs went public this past week.

U.S. IPO Weekly Recap: 3 Micro-Cap IPOs Come To Market During The February Lull

Emerging Markets Internet & Ecommerce ETF

AdvisorShares Pure US Cannabis ETF

Invesco Golden Dragon China ETF

Morgan Creek Exos SPAC Originated ETF

Roundhill Streaming Services & Technology ETF

Some of the worst-performing funds of 2021 could be the best ETFs to buy for 2022. Here are seven that ought to rebound in the year ahead.

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A healthy IPO market has provided a timely windfall for many non-investment grade issuers looking to deleverage after a challenging 2020.

The IPO Boom Isn't Just About The Equity Market

The global market for initial public offerings was off to a great start this year and is still running hot. 2021 is on its way to become the record year for IPOs.

2021 Likely to be a Record Year for IPOs: ETFs to Win

As capital market insiders anticipate a strong finish to the year for initial public offerings with a robust pipeline slated for 2022, investors could also tap into the IPO market with thematic exchange traded funds. Over 2,000 IPOs have raised a combined $421 billion globally as of the end of September, a record high, as [.

IPO ETFs Could Enjoy a Strong Finish to the Year

2021 is another blockbuster year for IPOs, here is what investors should know.

With IPOs Red Hot, What's Next for ETFs?

First Trust International Equity Opportunities ETF

The SPAC market has somewhat reset from the initial euphoria. SPACs will continue to provide a useful and efficient avenue to take private companies public.

Is The SPAC Party Over?

The global market for initial public offerings was off to a great start this year and is still running hot. There have been 250 IPOs priced this year, up 190.7% from last year.

2021 to be a Record Year for IPOs? ETFs in Focus

Last year, the pandemic may have tamped down venture capital (VC) funding, but as global economies heal, VC is starting to show signs of life again in North America. This presents an opportunity for ETFs that focus on initial public offerings (IPOs).

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CM Life Sciences III - Unit

Five Star Bancorp

Reneo Pharmaceuticals

Splash Beverage Group

VectivBio Holding AG

Zoom Video

Just two IPOs priced this past week, raising $222 million as the US IPO market continued to cool down. The IPO pipeline remained active, with 13 IPOs and 14 SPACs submitting initial filings this week.

News for Renaissance International IPO ETF ETF (IPOS)