The IPO study called a 32% crash. This time looks different.

Semis already paid the toll before SK Hynix even priced.

Before the SpaceX IPO, a Journal of Finance study said the rivals would sell off when the giant lists. They did. Virgin Galactic dropped 32%, ASTS 15%, the whole basket got hit.

SK Hynix is the next mega IPO, and the pattern looks broken. Here’s why.

Into SpaceX, the space names ran up 23% and then got crushed on debut. Into SK Hynix, the opposite happened. Roughly $1.5 trillion has already left the semiconductor complex. SMH is about 10% off all-time highs even after a strong bounce. Micron is down almost 20%. SanDisk the same.

And the deal is 7x oversubscribed. They asked for $26 billion and institutions offered seven dollars for every one. The money is already raised, the rotation already happened. The debt got prepaid.

So the read changes. This isn’t money getting sucked out of Micron to buy SK Hynix. That’s done. Now they likely all move together. If SK Hynix rips, the complex rips. If it flops, everything sells with it. Some of these calls will be wrong, and when they are, we publish that too.

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Michael Nauss, CMT, CAIA, CDMS