The First Trust IPOX-100 Index (FPX) exchange traded fund (ETF) that tracks the top 100 U.S. FPX could see a new holding in its future now that the Visa IPO is one step closer to creation. Currently, FPX is up 5.6% year-to-date and has outperformed the S&P 500 for the year.

Visa plans to seek approval from member financial institutions, which would pave the way for an IPO early next year, according to Tate Dwinnell for Self Investors. The biggest beneficiaries when Visa completes its IPO process will be major U.S. financial institutions such as Bank of America (BAC), Wells Fargo (WFC) and JPMorgan Chase (JPM). They stand to reap hundreds of millions of dollars in capital gains if they sell part of their stakes.

After Mastercard (MA) completed its initial public offering, Citigroup (C) and JPMorgan Chase (JPM) cashed out of their holdings and took one-time gains worth more than $100 million. If the success of the Mastercard (MA) IPO is any indication, the Visa IPO, which is the world’s largest credit card company, will be successful as well. This epic IPO filing is definitely one to watch.


The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.