Recent IPOs Continue to Surge

Today Annie’s ($BNNY) began trading on the NASDAQ and was welcomed with a wave of buying. The maker of organic food priced its IPO at $19 per share, above its revised target of $16 to $18. The stock quickly surged to a high of $36.52 before finishing the session at $35.92, up 89% of the IPO price.

Another recent IPO, Yelp ($YELP) closed higher by 1.6%, but was much higher during intraday trading. Brightcove ($BCOV) and Demandware ($DWRE) also closed at their best levels ever after debuting in the last two months. Even internet company, Angie’s List ($ANGI) was able to rally over 5% to close at its best level since it began trading in December of last year.

ETF to Watch: First Trust IPOX 100 Index ETF ($FPX).

ETF of the Day - First Trust IPOX 100 ETF

First Trust IPOX 100 Index ETF ($FPX)

The name can be a little deceiving because it suggests it invests in 100 recent IPOs. The ETF does just that, but investors must realize that the stocks can trade for up to 1000 days after they become public to be considered for the ETF. The biggest holdings as of today are Visa ($V), Philip Morris International ($PM), General Motors ($GM), and Kinder Morgan ($KMI).

As far as sectors, IT makes up 25%, consumer discretionary 23%, consumer staples 18%, and energy 14%. Investors hoping to get a large exposure to the more recent IPOs and cloud computing will be disappointed. That being said, the ETF hit a new all-time high last week and the top 10 stocks are impressive. The net expense ratio on the ETF is 0.60%.