Weakness in Renaissance International IPO ETF's Process and People Pillar ratings limits this strategy to a Morningstar Medalist Rating of Negative. The portfolio maintains a sizable cost advantage over competitors, priced within the second-lowest fee quintile among peers.  

 The strategy receives 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 firm has some investor-friendly attributes, like overall attractive fees, but it is held back by a bench of limited-tenure portfolio managers. As a result, the firm gets an Average Parent Pillar rating.

Analyst Rating

Wise Plc - Ordinary Shares - Class A

Pendrell

Western Asset Corporate Loan Fund Inc

Aris Water Solution

Denbury Resources

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 predominant detractor from the rating is the fund's unremarkable 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 holds the process back. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's subpar 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 utilities and consumer cyclical relative to the category average by 8.7 and 5.0 percentage points, respectively. The sectors with low exposure compared to category peers are healthcare and industrials, underweight the average by 9.4 and 5.2 percentage points of assets, respectively. The portfolio is composed of 54 holdings and is relatively concentrated. In particular, 54.1% of the strategy's assets are housed within the top 10 holdings, compared with the typical peer's 17.8%. And finally, in terms of portfolio turnover, on a year-over-year basis, 68% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Process

Renaissance Capital’s team earns a Low People Pillar rating. The most significant detractor from the rating is the experience of the management team, which averages three years at this fund. The parent firm's five-year retention rate of 33% also holds the team back. The parent firm's inferior 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

In a competitive industry, Renaissance Capital doesn't differentiate itself enough, leading to an Average Parent Pillar rating. A strength of Renaissance Capital is that its product shelf of open-end and exchange-traded funds is, on average, offered at a minimal cost, suggesting that it considers what's best for its investor base. On average, fees for funds are in the lowest quintile of respective category peers. A cause for concern at Renaissance Capital is its relatively inexperienced longest-tenured management. In particular, average tenure at the firm is only three years, a negative contributor to the rating. The Renaissance Capital roster of open-end and exchange-traded funds has had below-average risk-adjusted performance, as seen in its average five-year Morningstar Rating of 1.0 stars.

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.

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

IPO activity in 2023 remained subdued compared to pre-pandemic years despite expectations of a surge. IPO experts are now predicting a resurgence in new stock offerings for 2024, but projections keep getting pushed back.

Even A Depressed IPO Market Can Produce (AI) Stars

Coinbase

Renaissance IPO ETF

Kenvue

Smith Douglas Homes Corp

While the calendar was quiet this past week, six IPOs joined the pipeline, two of which we estimate could raise $1 billion or more. Three biotechs filed to raise $100 million.

U.S. IPO Weekly Recap: 2024 IPO Market Starts Off With $2B Additions To The Pipeline

iShares MSCI ACWI ex U.S. ETF

Hornbeck Offshore

Inno Holdings Inc

Porsche Automobil Holding SE

ZKH Group Ltd

One small IPO priced this week, along with one SPAC that began trading. Three IPOs and four SPACs joined the pipeline. Offshore transport services provider Hornbeck Offshore Services filed to raise $100 million.

US IPO Weekly Recap: IPO Pipeline Adds Another Sizable Name Amid More Small Listings

Alpha Technology Group Ltd

Hamilton Insurance Group Ltd

Lexeo Therapeutics Inc

Neo-Concept International Group Holdings Ltd

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.

Arm deal is expected to lift tech IPOs, but not all future debuts will have the same draw

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.

A Strong IPO Market Awaiting in 2024? ETFs in Focus

Normally, IPO activity gains momentum in the second quarter, and peaks in June. And this year was no exception to this trend.

Inside the IPO Market Recovery: ETFs in Focus

Atmus Filtration Technologies Inc

Azitra Inc

CaliberCos Inc

FG Group Holdings Inc.

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.

U.S. IPO Weekly Recap: Atmus Launches $275 Million IPO And Restaurant Chain CAVA Joins The Pipeline

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.

U.S. IPO Weekly Recap: Pipeline News Disrupts An Otherwise Silent Week For The IPO Market

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.

U.S. IPO Weekly Recap: Kenvue And ACELYRIN Fire Up The IPO Market, Raising A Combined $4.3 Billion

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.

U.S. IPO Weekly Recap: No IPOs, But Pipeline Gets A $350 Million Pick Up From Cummins Spin-Off Atmus

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.

IPO ETFs Underperform Havoc in 2022: What Lies Ahead?

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.

7 ETFs to Buy on Sale After Falling 30% in 2021

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.

News for Renaissance International IPO ETF ETF (IPOS)