🦘 Deliveroo's stock market crash

Not what investors ordered | There's no point stock picking | [TOGETHER WITH]( Hi {NAME}, here's what you need to know for April 1st in 3:06 minutes. 👋 Come find the official Finimize Club on Clubhouse: join us for today’s show at 6pm UK/1pm NY time to discuss Deliveroo’s first 24 hours on the London Stock Exchange. [Join the club]( Today's big stories - Deliveroo’s stock tanked on its market debut and retail investors might get burned the worst - A new space exploration exchange-traded fund has hit the market, but it isn’t all it’s cracked up to be – [Read Now]( - Only half of Europe’s professional stock pickers outperformed the market last year, suggesting it might not be worth their effort Deliverooh [Deliverooh] What’s Going On Here? Deliveroo’s hotly anticipated stock market debut turned up cold on Wednesday as the food delivery firm’s newly public share price ended its first day [down 13%]( – and left its retail investors most at risk of a one-star experience ([tweet this](). What Does This Mean? As foreseen in the Finimize app’s [exclusive analysis]( last week, Deliveroo announced shortly before its [initial public offering (IPO)]( that shares would begin trading at the lower end of expectations. Since recent listings have generally [launched]( at the top of their advertised price ranges, that already suggested there was limited investor appetite for [yet another]( food delivery stock. Deliveroo nevertheless managed to raise $2 billion as planned, starting Wednesday worth $10 billion. But its valuation immediately fell 30% as the stock market opened for “[conditional dealing](” of the company’s shares. Deliveroo’s shares recovered some ground by the end of the day – but not before trading was [briefly suspended]( in the wake of wild price swings. Why Should I Care? For markets: Investors are backpedaling. Several high-profile investors have [highlighted]( big risks involved in backing the primarily bicycle-based food delivery company. In the wake of Uber’s enforced [reclassification]( of its UK drivers as “workers”, rather than cheaper contractors, Deliveroo may soon face similarly elevated costs. What’s more, with lockdown restrictions easing and people returning to restaurants, the company’s growth is set to slow. And a chronic lack of profit – another big deliverisk – means Deliveroo may be poorly placed to adapt to potential changes in its regulatory and market environments. For you personally: Retail investors could get burned. Spare a thought for those small-time individual investors who were, for once, able to buy directly into Deliveroo’s IPO – but who can’t actually trade their shares until next week. If they respond to Wednesday’s losses by rushing to sell at the earliest opportunity, retail investors could serve up more trouble for Deliveroo’s share price. You might also like: [Our analysis on whether you should buy Deliveroo shares.]( Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Deliverooh&utm_campaign=daily-global-01-04-2021&utm_source=email) 2. Analyst Take Space Stocks Are Going To The Moon What’s Going On Here? Space – the final frontier – is [an exciting sector to invest in](, but there are precious few publicly traded companies operating in the industry. Ark Investment Management’s new [Space Exploration and Innovation exchange-traded fund]( aims to solve that – but some of its “space exploration” stocks simply don’t fit the bill. Other funds, meanwhile, have focused on aerospace or satellite communications stocks – which is more of a small step than [a giant leap toward space investing](. There are [pure-play space stocks coming]( to the stock market soon, though: it’s worth you knowing where to find them. So that’s today’s Insight: [how you can actually invest]( in space travel now and in the not-so-distant future. [Read or listen to the Insight here]( SPONSORED BY BESTOW You never know what’s around the corner Life is unpredictable: you know that all too well after the past year. And that’s exactly why you might want to consider protecting the future. With term life insurance – like that offered by [Bestow]( – you can make sure your family is looked after for [as little as $10 a month](, just in case something unexpected happens. One monthly payment could help you [leave up to $1.5 million]( for your loved ones, worst comes to worst. That could mean no loans to pay off, no looming medical bills, no mortgage worries. It’s [super quick to apply]( – we’re talking five minutes quick – and you’ll [get a decision instantly](. You can even apply directly from your phone or computer. [Get a quote](, and start from just $10 a month. [Get Your Free Quote]( Please support our sponsors Stuck Pickers [Stuck Pickers] What’s Going On Here? A new [study]( this week revealed only half of Europe’s professional stock pickers beat their benchmarks in 2020 – lending further weight to the idea that such “active” investment strategies simply aren’t worth it. What Does This Mean? Much ink (and probably even a bit of blood) has been spilled over which approach delivers better returns: picking individual investments or “passively” backing entire markets. Most research lands with the latter – but active advocates claim that when [volatility]( spikes, professional stock (and [bond]() pickers prove their worth by better navigating big swings up and down. Those hopes may now have been dashed, however. Amid last year’s pandemic panic and the subsequent "[everything rally](", just 50% of European active investment funds outperformed a passive equivalent. That’s admittedly higher than the ten-year average success rate of under 25% – but it’s hardly a resounding victory. Things [weren’t]( any better across the Atlantic, either: only 49% of active American funds outperformed their passive peers last year, according to a report out earlier last month. Why Should I Care? For markets: Hot pockets persist. Active investment strategies tend to work better in some areas than others. In the US, long-term success rates are highest for active funds investing in bonds, real estate, and international stocks – and lowest among funds that invest in the biggest US stocks. That stands to reason: America’s largest companies are so closely watched by so many investors that it’s much more difficult to find potentially undervalued gems. The bigger picture: Get the best of both worlds. Active and passive philosophies aren’t mutually exclusive: after all, investors still have to make decisions about which passive funds to pick and in what proportion. You can also further combine the two strategies through a "[core-satellite](" approach, benefiting from both the solid diversification of passive investments and the enhanced potential of smaller freewheeling trading ideas. You might also like: [The four things to consider when picking an investment fund.]( Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Stuck Pickers&utm_campaign=daily-global-01-04-2021&utm_source=email) 💬 Quote of the day “Acquaintance, n.: A person whom we know well enough to borrow from, but not well enough to lend to.” – Ambrose Bierce (an American short story writer, journalist, poet, and Civil War veteran) [Tweet this]( SPONSORED BY TASTE LABS There’s no accounting for good Taste There’s more choice than ever these days, but more endless scrolling too. [Taste Labs]( is on a mission to fix that: the company’s AI platform offers tailored product recommendations based on your – you guessed it – personal taste. Good idea, right? Well, Taste is raising money on StartEngine, and you could back the company as it goes from strength to strength. See, Taste’s app is one of the world’s most downloaded recommendation apps, with [over 500,000 users]( and more than 4,000 five-star reviews. In fact, Taste’s user base [grew organically by 76% last year](, and the company’s raised over $1 million since 2019. People like it, is what we’re saying. There’s only one more week to invest: [find out more about Taste Labs](. [Find Out More]( Please support our sponsors 📚 What we're reading - Bitcoin: the new 401k? ([Swan Bitcoin]()* - Put your money to work ([Yieldstreet]()* - One woman’s right to die ([The Guardian]() - Grilling on Icelandic lava ([National Post]() - Satan in a shoe ([CNN]() *This sponsored content helps us keep the newsletter free. 🌎 Finimize Events 💥 Spot the next bitcoin Smart investors know that getting into any market early is key to success, and crypto’s no exception. If you want to find out [how to spot the next bitcoin](, join us and Coinlist’s Mike Zaiko on April 7th. He’ll break down how to identify, evaluate, and invest in the best new crypto assets before they list on the major crypto exchanges. [Don’t miss it]( 😡 [The Influence Of Behavior On Investing](: 5pm UK time, March 31st ♻️ [ESG: The Environmental Perspective](: 6pm UK time, March 31st ⏰ [Is It Too Late To Invest In Bitcoin?](: 1pm UK time, April 1st 🥕 [Crafting A Vegan Portfolio](: 6pm UK time, April 6th 🚀 [The Rise Of The Retail Investor](: 9pm Hong Kong time, April 6th 👀 [How To Spot The Next Bitcoin](: 12pm NY time, April 7th 💵 [The Surge In Digital Payments](: 6pm UK time, April 8th 🍷 [Investing In Wine And Whiskey](: 6pm UK time, April 9th 💆 [Control Your Emotions, Control Your Trading](: 6pm NZ time, April 12th 🔥 [The Three Most Important Trading Signals](: 6pm UK time, April 20th 🏡 [The Pros And Cons Of REITs And Real Estate](: 1pm UK time, April 22nd 🛢 [How To Inflation-Proof Your Portfolio](: 6pm UK time, April 22nd 💰 [Crowdfunding Club](: 1pm NY time, April 28th ❤️ Share with a friend Your Referrals: 0 Thanks for reading {NAME}. If you liked today's brief, we'd love for you to share it with a friend. If they sign up on your unique link, you’ll earn some sweet swag. Share your unique link: [ You stay classy, {NAME} 😉 We’d love to hear your thoughts. [Give feedback]( Want to advertise with us too? [Get in touch]( Image Credits: Image credits: Frederik Lipfert @frederikli - Unsplash | Raymond Kasprzak, Towfiqu ahamed barbhuiya - Shutterstock Preferences: [Update your email]( or [change preferences]( [View in browser]( [Unsubscribe]( from all Finimize Emails 😴 Crafted by Finimize Ltd. | Third Floor, 1 New Fetter Lane, London, EC4A 1AN, UK. All content provided by Finimize Ltd. is for informational and educational purposes only and is not meant to represent trade or investment recommendations. You signed up to this mailing list at finimize.com or through one of our partners. © Finimize 2021 [View Online](