IPO Party Like It's 1999

September 06, 2006

STOXX rolls out IPO indexes in Europe, while ABN Amro launches new index certificates tied to the Schuster IPO index in Europe.

If imitation is the most sincere form of flattery, Joseph Schuster must be celebrating right now.

Schuster, the developer of the IPOX-Schuster IPO indexes, has spent the better part of the last half-decade preaching to the world about initial public offerings (IPOs). In his view - and it was a lonely view to have for a while - IPOs represent an entirely new asset class within equities, offering a different return profile and risk characteristics compared to other types of stocks. Schuster developed IPO indexes to track this performance, one of which has been turned into an exchange-traded fund (ETF) in the U.S. Slowly, more and more people have come to respect - or at least consider - his arguments.

This week, however, Dow Jones STOXX paid Schuster the highest complement, as it launched its own set of IPO indexes in the European market. The new Dow Jones STOXX IPO indexes track the performance of European IPOs over three different time durations - 3, 12 and 60 months.  In each case, IPOs are added to the index on the day after their initial offering, and stay in the index for the named duration.

"Initial Public Offerings are considered more and more as an asset class of its own and increasingly have gained investor attention," said Lars Hamich, managing director, STOXX Ltd. "The Dow Jones STOXX IPO Indexes offer flexible and investable tools to participate in the performance of this highly dynamic equity market segment from the first day a company is listed."

 

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