Finimize - 🍎 An IPO a day keeps the doctor away

Hi Reader, here's what you need to know for June 21st in 3:06 minutes.

💩 You’d be forgiven for not wanting to go anywhere near the crypto market right now. But join Finimize analyst Reda Ferran for 5 Questions To Ask Before Investing In Any Crypto Project on June 22nd, and you might actually dare to consider the possibility of buying in again…

Today's big stories

China's IPO market is much, much bigger than those of its rivals this year
The 60/40 has had a terrible quarter, but a few tweaks could make it as effective as ever – Read Now
The airline industry is finally expected to return to profit next year

Beauty Sleep

What’s Going On Here?

Data out on Monday showed that the value of Chinese initial public offerings (IPOs) is the highest in the world so far this year.

What Does This Mean?

Plenty of cogs in the Chinese economy have ground to a halt this year, but stock market listings aren’t one of them. That’s largely because the government sent officials to Shanghai’s stock exchange amid the city-wide lockdown, leaving them to approve IPOs by day and recuperate on inflatable beds by night. It was in the country’s interests to do just that, given how keen it is for companies in sectors essential to economic growth – renewables, chipmaking, high-end manufacturing – to keep listing. And it worked a treat: China averaged over one IPO a trading day during the lockdown, raising nearly $9 billion in April and May (tweet this). That means the amount of money raised by Chinese IPOs is up 7% this year from last, even as the rest of the world has seen an 80% dropoff.

Why Should I Care?

Zooming in: Needs must.
Keep in mind too that some Chinese companies’ hands were tied here. For one thing, those that received the green light just before lockdown were regulation-bound to go ahead. And for another, the government still hasn’t finalized rules around whether companies that hold a lot of sensitive user data can list abroad, which means any that needed a cash boost had next to no choice but to list domestically.

The bigger picture: Eeny meeny miney…
If the going was good when China was in lockdown, analysts think companies could be even more enthusiastic to list now the country’s out of it. It helps too that one of the main alternatives looks a lot less appealing: the US stock market is tanking due to high inflation and rising interest rates, while China’s stock market is up 15% from its lows in April.

You might also like: China’s best-performing hedge fund is up 138% this year. Here’s its next play.

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Analyst Take

How To Fix The Faulty 60/40

Reda Farran, Analyst

What’s Going On Here?

The time-honored 60/40 investment strategy – 60% stocks, 40% bonds – hasn’t exactly covered itself in glory lately.

The portfolio is set for its worst quarterly performance in decades, as concerns that we’re on the verge of stagflation simultaneously undermine the prices of both stocks and bonds.

But you don’t need to give up on the old faithful diversification strategy entirely. Instead, you might want to just consider fixing it up with a new approach.

That’s today’s Insight: how to fix the 60/40.

Read or listen to the Insight here

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Check Innovega out on StartEngine.

Find Out More

You should read the Offering Circular and risks related to this offering before investing. This Reg A+ offering is made available through StartEngine Primary, LLC, member FINRA/ SIPC. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment.