New IPO ETF Comes to Town

With reports out Wednesday that a roadshow is imminent and that social media darling Twitter could be trading on the New York Stock Exchange sometime next month, some investors might want to look at ETFs that could house shares of Twitter.

One debuted Wednesday, the Renaissance IPO ETF (NYSEArca: IPO). Connecticut-based Renaissance also issues the actively managed Global IPO Plus Aftermarket Fund (IPOSX) mutual fund.

“The launch of the Renaissance IPO ETF, is a direct response to increased investor demand for systematic exposure to newly listed IPOs in a low-cost tax-efficient exchange-traded structure,” said Kathleen Smith, Chairman of Renaissance Capita, in a statement. “When added to core U.S. equity holdings, a portfolio of unseasoned publicly traded equities provides investors with more comprehensive exposure to the full set of U.S. public equities.”

IPO, which has an annual expense ratio of 0.6%, tracks the Renaissance IPO Index. “As of September 30, 2013, top holdings in the index include an 11.0% position in leading social network Facebook (NasdaqGM: FB), a 9.8% position in global luxury fashion brand Michael Kors Holdings (NYSE: KORS), and a 4.5% position in cloud-based HR platform Workday (NYSE: WDAY),” according to the statement.

Another index members include Delphi Automotive (NYSE: DLPH), Realogy Holdings (NYSE: RLGY) and Splunk (NasdaqGM: SPLK).

IPO has a director competitor in the form of the First Trust US IPO Index Fund (NYSEArca: FPX). FPX has been successful in its own right, but there are key differences between the two funds. [New IPO ETF to Roll Out Soon]