Alibaba Group Holding (NYSE: BABA) lockup period will soon expire, but China equities and initial public offering-related exchange traded funds with heavy exposure to Alibaba remain relatively unfazed.
For instance, the KraneShares CSI China Internet Fund (NasdaqGM: KWEB), which has a 10.5% position in BABA, saw $6.4 million in inflows over the past week and the Emerging Markets Internet & Ecommerce ETF (NYSEArca: EMQQ), which has a 9.9% tilt toward BABA, added $1.1 million over the past week, according to ETF.com data. [New ETF Gets Right to it With EM Internet Stocks]
Other ETFs that have notable weights in BABA include the KraneShares CSI New China ETF (NYSEArca: KFYP) with a 15.8% position and the Renaissance IPO ETF (NYSEArca: IPO) with a 11.5% position.
The lockup period for 8.1 million Alibaba shares will expire tomorrow, December 19, allowing insiders to sell their shares, reports Leslie Picker for Bloomberg. [Talk Still Swirling About Alibaba’s Index Opportunities]
While lockup expirations have pressured newly public corporations, the number of shares in the December period only represents 1.6% of shares eligible to trade. Traditionally, lockup expirations may spook investors since a sudden influx of company shares could outpace demand, depressing stock prices.
Looking ahead, future lockup expirations could cause a greater commotion. For example, 429 million shares owned by insiders will become free to trade in March and another 1.6 billion shares will be available in September.