Fund Management
Fidelity Retail Clients Get Access To IPOs Following Credit Suisse Link-Up
Fidelity Investments is teaming up with Credit Suisse so that its retail clients customers can gain access to the IPO market.
Fidelity Investments is teaming up with Credit Suisse so that its retail clients customers can gain access to the IPO market.
The move is being driven by Fidelity’s high net worth customers who have told the firm they want more exposure to company flotations. A 2013 Fidelity survey of 2,500 affluent and high net worth clients said that over half of those surveyed currently buy or are open to investing in IPOs.
The tie-up is only for Fidelity’s retail brokerage clients and applies to companies listed in the US, including Alibaba which is set to list on the New York Stock Exchange. The firm’s fund managers already have access to the French bank’s IPO business.
So far 232 companies have gone public in the US this year, up 79 per cent on the same period last year. Credit Suisse ranked sixth for global IPO underwriting in the first half of the year, according to Thomson Reuters, having handled 63 offerings.
“With the increase in IPO activity over the past year and the potential for growth in the IPO market over the next few years, this new agreement with one of the industry’s leading underwriters will provide our clients with more opportunities to participate in new issue equity deals,” said Brian Conroy, president of Fidelity Capital Markets, Fidelity’s institutional trading arm.
“The agreement with Credit Suisse, which ranks No. 2 in market share for US listed IPOs, is a continuation of our focus on leveraging our scale to offer our clients broader access to the IPO market, typically only accessible for larger institutional investors,” he added.
It is not the first time Fidelity has entered into a partnership to increase direct access for retail customers to some of the most popular stock offerings. Five years ago it started a similar arrangement with the capital markets arm of Kohlberg Kravis Roberts, giving its retail clients unique access to IPOs arranged by KKR. Those were primarily offerings held by the private equity giant’s portfolio companies.
