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FPX ETF: IPO Slowdown Tests the Disruptor Bet
The First Trust US Equity Opportunities ETF (FPX) has lagged the S&P 500 as the US IPO pipeline contracts. The fund's performance hinges on the fall IPO calendar. Here's what to watch.
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The First Trust US Equity Opportunities ETF (FPX) has lost ground to the S&P 500 this year as the pipeline of new US listings dried up. The fund, which holds stocks within 12 months of their initial public offering, returned a fraction of the broad market's gain through mid-2025, according to Morningstar data. The underperformance reflects a simple reality: there are fewer IPOs to buy, and the ones that made it through the window have struggled.
The IPO market peaked in 2021, with 1,035 listings raising $339 billion, per Renaissance Capital. That pace collapsed. Through the first five months of 2025, just 68 companies went public in the US, raising $21 billion. The drought has left FPX with a portfolio that tilts toward older, underperforming stocks rather than the fresh disruptors the fund's name suggests.
Several of the fund's top holdings trade below their IPO prices. The construction itself creates a drag: FPX automatically sells stocks after 12 months, forcing turnover at inopportune times. When the IPO market is slow, the fund replaces weaker names with new issues that lack a proven track record. That mechanical churn amplifies the slump.