IndexIQ Launches U.S. Hedge Fund Replication ETF

Mar 26 2009 | 2:24am ET

Just two weeks after Deutsche Bank launched the first-ever hedge fund index-linked exchange-traded fund in Germany, the U.S. is getting one of its own.

IndexIQ, which specializes in alternative investment indices and hedge fund replication products, has listed its IQ Hedge Multu-Strategy Tracker ETF (Ticker: QAI) on the NYSE Arca electronic exchange. The fund is designed to track the index of the same name, which it launched in September.

While the fund is designed to replicate the performance of hedge funds, including long/short equity, global macro, market-neutral, event-driven, fixed-income arbitrage and emerging markets funds, it does not invest in hedge funds at all. Instead, it consists entirely of other ETFs, with more than half of its assets held in the iShares Leham Aggregate Bond Fund, iShares Lehman 1-3 Year Treasury Bond Fund and iShares MSCI Emerging Markets Index Fund.

“A large body of academic research shows that one need not necessarily invest directly in a hedge fund to capture much of the potential benefits of the various hedge fund strategies,” Robert Whitelaw, a finance professor at New York University and chief investment strategist at IndexIQ, said.

“IQ Hedge Multu-Strategy Tracker ETF brings together two of the most significant developments in the investment business over the last several years—the growing importance of alternative investments and the convenience, low cost, liquidity and transparency of ETFs,” Adam Patti, CEO, said.

“From the start, our goal has been to help democratize access to the alternative investment asset class by making these products broadly available to all investors with full liquidity, transparency and low cost.”

Low cost, indeed: No two and 20 here; IndexIQ’s ETF boasts an expense ratio of 0.75%.

The rollout of the ETF comes just a few months after IndexIQ added Paul Mazzilli, arguably the leading ETF analyst, as senior advisor. Mazzilli had spent the previous 33 years at Morgan Stanley.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.