Facebook IPO Delay: Adverse Impact On Social Media ETF? (SOCL)
Following a CNBC report that social media darling Facebook could delay its initial public offering until June, the Global X Social Media Index ETF (Nasdaq: SOCL), the lone ETF devoted exclusively to social media stocks, has moved noticeably lower.
When CNBC initially reported, citing people familiar with the matter, that deal-making and other distractions could delay the Facebook IPO, SOCL was trading at $15.16. At this writing, the ETF is trading at $15.07.
SOCL, which debuted in November 2011, has seen its assets under management total quietly move higher in advance of the Facebook IPO. As of the close of markets on Monday, SOCL had $14.5 million in AUM. That's up from $11.5 million on April and less than $9 million on March 21.
When Facebook initially filed plans for its IPO earlier this year, SOCL surged, putting to bed some of the criticism surrounding the fund immediately after it came to market. SOCL's AUM and average daily volume numbers jumped in the wake of the Facebook IPO news.
News that the offering may delayed could prove to be a near-term hurdle for SOCL because it is widely expected that the ETF will be the first to make room for Facebook. In an interview with Benzinga earlier this year Global X CEO Bruno del Ama said Facebook could become a SOCL constituent as soon as the end of the stock's fifth trading day.
"At a $75 billion to $100 billion valuation with a free float of 5% to 10%, Facebook would immediately be among the largest holdings in the ETF," del Ama said in the February 1 interview.
Currently, China's Tencent Holdings and LinkedIn (NYSE: LNKD) are SOCL's top two holdings with a combined weight in excess of 23%. Other top holdings include Russia's Yandex (Nasdaq: YNDX), Sina (Nasdaq: SINA), Google (Nasdaq: GOOG) and Zynga (Nasdaq: ZNGA).
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