FTSE Renaissance IPO Composite Index by bdu12746

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									FTSE Renaissance IPO Composite Index                                                                                                                                             
 
 

    Generates Superior Risk‐Adjusted Returns  
The FTSE Renaissance IPO Composite Index has shown
significant outperformance relative to major equity indices over
                                                                             110%
time. Since inception, the IPO Index has outperformed the
broader indices. By investing in IPOs on a float weighted




                                                                          Return
                                                                                   60%
basis, emphasis is placed on those companies with the highest
unfolding liquidity and strongest performance, which enables
this asset class to produce unique and superior risk-adjusted                      10%

returns.                                                                                 2003        2004          2005          2006         2007          2008           2009
                                                                              ‐40%
                                                                                                           FTSE Renaissance IPO Composite Index            S&P 500
 
 
                                                                                                           RUS 2000                                        RUS 3000
 
 
 




   Adds Diversification by Picking up Performance Ahead of other Indices 
 




The FTSE Renaissance IPO Composite Index adds IPOs at the close of the first day of trading. This early inclusion is well in advance of
the other major indices, where newly public companies must wait up to a quarter or longer for inclusion. Thus, major indices miss the
early returns on newly public companies and underweight the new industries that typically manifest themselves first in the IPO market.
For example, Visa, which went public on March 19, 2008, gained 85% before it was included in the Russell 3000 on June 30, 2008.
 
 




    As of December 31, 2009                    3M           6M                12M                      3YR                  5YR                   Alpha               Sharpe
    FTSE Renaissance IPO Composite Index     12.7%         27.0%             54.9%                   ‐11.1%                28.5%                    ‐‐‐                ‐0.09 
    S&P 500                                   5.5%         21.3%             23.5%                   ‐21.4%                ‐8.0%                  6.4%                 ‐0.41 
    Russell 2000                              3.5%         23.0%             25.2%                   ‐20.6%                ‐4.0%                  3.0%                 ‐0.26 
 
    Russell 3000                              5.4%         21.9%             25.5%                   ‐20.6%                ‐5.8%                  5.8%                 ‐0.37 
 
 
 
 
 
 
 
 
 
 
 




           A Liquid Alternative to Alternatives                                                                      Good Timing
Newly public companies are specialized equities with exploitable                   Academic studies show that in weak stock markets
      
information asymmetries similar to alternative investments. Like                   characterized by low issuance of IPOs, only the strongest and
private equity investments, IPOs are under-researched, lack                        most attractively priced companies are able to go public. These
trading charts, have untested governance and lack an established                   companies have historically produced superior long-term
shareholder base. Yet, IPOs possess far greater liquidity and                      returns.
transparency than alternative equities.  



    Captures an Economically Significant Category of Equities
IPOs represent one-third of total equity capital
                                                        Constituent Sizes                       % Mkt Cap         Top 5 Constituents                        Market Cap $m
raised. The market capitalization of the FTSE
                                                                                                                  Visa (V)                                     $64,950
Renaissance IPO Composite Index has                     Large Cap (Over $5B)                          2%          Verisk Analytics (VRSK)                       $5,452
averaged $306 billion over the past six years,          Mid Cap ($1B to $5B)                         24%          American Water Works (AWK)                    $3,913
permitting significant indexing capacity. This          Small Cap ($250M to $1B)                     56%          Mead Johnson Nutrition (MJN)                  $8,937
is because the IPO market is not just limited to        Micro Cap (Less than $250M)                  17%          Intrepid Potash (IPI)                         $2,189
small cap companies, but includes companies                                                                                                                 Data as of 12/31/09   
from all sectors and sizes.
 
 
  Designed by IPO Experts to Harness the Power of IPOs
The FTSE Renaissance IPO Composite Index is a comprehensive benchmark index designed to capture the essence of IPO activity and
performance. It is the first index to incorporate the truly investable IPO universe by using float-adjusted shares and the first to account
for the unseasoned nature of the asset class by including a rolling two-year population of IPOs starting from the first day of trading. The
Index includes all institutionally-investable U.S.-listed IPOs, capturing over 95% of the total market value of the IPO universe. The Index
was designed by Renaissance Capital, the global leader in IPO Research, and is managed by leading index provider FTSE, to provide
investors with a comprehensive and structured vehicle to invest in the IPO market.



Renaissance Capital LLC             Two Greenwich Plaza      Greenwich,  CT  06830                     www.renaissancecapital.com        203.622.2978 

								
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