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Speaker 1: Da Brady is going to be with us out of

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Speaker 1: the UK and ten minutes time. Do you remember I

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Speaker 1: was telling you maybe last week that there was the

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Speaker 1: National MP who'd berated Jacinda Ardern in Parliament and she's

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Speaker 1: written about it in her book. We now know who

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Speaker 1: it is is Amy Adams. We know this because Audrey

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Speaker 1: Young has put it in her column. She says there

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Speaker 1: is only one MP who meets that description, had a

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Speaker 1: bob and was respected by labor, and it was Amy Adams,

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Speaker 1: which is what our sources in the National Party had

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Speaker 1: also told us, if you recall. Also, did you know

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Speaker 1: that Grant Robinson has got his own memoir coming out.

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Speaker 1: It's called Anything Could Happen and it's due out in

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Speaker 1: two months time. Yay, can't wait? Twenty four away from seven. Now,

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Speaker 1: after a couple of dire years, we're seeing the number

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Speaker 1: of companies listing on stock exchanges rise again and IPO

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Speaker 1: is a key source of funding for companies and investors

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Speaker 1: get very excited about them. And Sam Dickey from Fisher

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Speaker 1: Funds is with me and very excited.

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Speaker 2: Sam, always very exciting. Way, good evening.

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Speaker 1: Now give me some context. Yeah, how many IPOs are happening?

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Speaker 1: At the moment you know, globally and regionally versus what

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Speaker 1: we've had in the past.

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Speaker 2: Well, the amount of IPOs globally tends to go hand

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Speaker 2: in hand with the amount of animal spirits or enthusiasm

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Speaker 2: in the stock market. So if you were selling the

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Speaker 2: company you own, you'd prefer to sell it when enthusiasm

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Speaker 2: for stocks is high. So twenty twenty one is a

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Speaker 2: good benchmark there. It was the everything bubble. Markets were

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Speaker 2: on fire, second end, cars are on fire, mean stocks

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Speaker 2: are on fire, and the issuance of IPOs. Then over

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Speaker 2: three thousand new companies were listed on the Stock Exchange

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Speaker 2: that year, which is a staggering number. And then in

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Speaker 2: twenty twenty two that issuance have so half the number

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Speaker 2: of companies listed the next year, and then halved again

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Speaker 2: in twenty twenty three. To give you a sense of

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Speaker 2: the scale. It picked up a little bit in twenty

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Speaker 2: twenty four, but in the US, for example, in the

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Speaker 2: last few months, the run rate of companies listing on

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Speaker 2: the Stock Exchange is doubled as animal spirits are returning. Now,

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Speaker 2: what's super interesting, this is a bit of an aside,

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Speaker 2: is in the last year or two India has been

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Speaker 2: listing more companies than the US is that tiger economy

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Speaker 2: continues to grow.

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Speaker 1: IPOs always good investments, though because there have been some shockers, haven't.

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Speaker 2: There definitely not always good investments. And actually you and

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Speaker 2: I did talk about this about eighteen months ago and

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Speaker 2: back in twenty twenty three. Of the ten largest IPOs

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Speaker 2: in the US, and that four year period from twenty

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Speaker 2: nineteen to twenty twenty three, eighty percent of them were underwater,

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Speaker 2: and they were underwater by an average of forty percent.

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Speaker 2: But that was a bit of a harsh time period

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Speaker 2: because investors were sliding down that slippery slope off the

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Speaker 2: peak of the last OPO cycle in twenty twenty one.

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Speaker 2: And if you think about it, when more than twice

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Speaker 2: as many companies as you would normally see lists on

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Speaker 2: the stock market, it's just a truism that many of

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Speaker 2: those IPOs will be lower quality. So more recently, as

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Speaker 2: the IPO cycle started picking up, usually you'll see higher

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Speaker 2: quality companies listing at the start in the middle of

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Speaker 2: the cycle than towards the end, and the returns are

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Speaker 2: much better. So high profile IPOs in the US like

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Speaker 2: Core Weed for example, when AI infrastructure play and circle

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Speaker 2: Internet a cryptoplay have both done very well, up one

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Speaker 2: hundreds of percent.

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Speaker 1: How do you know, I mean, if you're an investor

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Speaker 1: and you see an IPO, how do you evaluate whether

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Speaker 1: it's a good one or not.

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Speaker 2: Well, it's much trickier because as an investor looking in

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Speaker 2: from the outside, and there is always an information imbalance

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Speaker 2: when you evaluate a listed company, you can even know

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Speaker 2: as much about the management or the board of that

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Speaker 2: company as to what makes that company tick. And that

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Speaker 2: imbalance is extreme when it comes to an IPO because

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Speaker 2: there is no decent historical track record to observe. And

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Speaker 2: the other thing to remember is all of the smartest

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Speaker 2: people in the room, so the owners, the management, and

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Speaker 2: the board, the people who know the most about the

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Speaker 2: company are usually selling, not buying shares. So that's that

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Speaker 2: sort of extreme imbalance, so that the bar to invest

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Speaker 2: in IPOs is high. But if you are going to

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Speaker 2: invest in IPOs, it's better to do it nearer the

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Speaker 2: start of the IPO cycle, when the number of listings

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Speaker 2: is only just starting to pick up. And a final

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Speaker 2: thing to remember here, there is that many great companies

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Speaker 2: and this is a new phenomenon in the last few years,

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Speaker 2: many great companies that choose not to list on the

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Speaker 2: stock market at all these days to stay private, and

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Speaker 2: that's because they have access to ample capital from private investors.

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Speaker 2: And that's one of the many reasons can we save

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Speaker 2: A Providers like Fisher are moving more into the private

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Speaker 2: equity space.

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Speaker 1: Very interesting stuff. Hey, thanks for talking us through that, Sam.

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Speaker 1: As always, it's fascinating to talk to you, Sam Dickey

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Speaker 1: of Fisher Funds.

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Speaker 2: news Talks. It'd be from four pm weekdays, or follow

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