ETF Database » MCRO

How Have The Hedge Fund ETFs Held Up In The Crisis?

Eric Dutram — Thu, 13 Oct 2011 11:00:26 +0000

Over the past several weeks, markets have become increasingly choppy as a number of issues are plaguing the global economy. America teeters on the brink of a recession while debt downgrades and slumping investor confidence have rattled European markets as well. Meanwhile, in emerging markets, inflationary concerns are continuing to wreck havoc leaving investors with few places to put cash to work. In light of this uncertain environment, many market participants have dialed back risk levels, focusing in on sectors that have low levels of correlation to broad markets, such as hedge funds. While many might think of hedge funds as some sort of ultra-high risk ”black box” type investment, that is not really the case for many products in the space. Instead, hedge funds should be thought of as a way to play broad markets with lower levels of risk. In fact, hedge funds will often take different sides [...]

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ProShares Launches Hedge Fund Replication ETF (HDG)

Michael Johnston — Fri, 15 Jul 2011 12:45:22 +0000

ProShares announced the launch of the Hedge Replication ETF (HDG), a new product that will seek to provide returns characteristic of the hedge fund asset class. The new ETF is designed to maintain a high correlation to the HFRI Weighted Composite Index, an equal-weighted composite of more than 2,000 funds. The new ETF will seek to accomplish its objective by employing a proprietary model to establish weighted long or short exposure to six factors: S&P 500 Total Return Index MSCI EAFE US Dollar Net Total Return Index MSCI Emerging Markets US Dollar Net Total Return Index Russell 2000 Total Return Index 3-month U.S. Treasury Bills ProShares UltraShort Euro ETF The ETF will rebalance monthly, at which point a systematic regression analysis will determine which weighting for the factors would have produced the strongest correlation with the HFRI benchmark over the previous 24 month period. The S&P 500, MSCI EAFE, and [...]

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How ETFs Have Democratized Investing

Michael Johnston — Thu, 10 Mar 2011 15:00:02 +0000

ETFs have been praised for improving the investing experience in a number of different ways. They have been the catalyst for a shift towards low cost indexing strategies, and have placed strong downward pressure on management fees throughout the investing landscape. They have improved tax efficiencies and intraday liquidity, allowing investors to move in and out of positions throughout the day and construct more complex short-term trading strategies. But arguably the greatest contribution of the ETF boom has been not the reduction in fees or the potential tax efficiencies; the tremendous growth of the ETF lineup has democratized the business of investing, opening up investment strategies and entire asset classes that have historically been accessible only to the largest and most sophisticated of investors. A significant portion of ETF assets are in “plain vanilla” products that offer exposure to domestic and international equities and U.S. bonds. And while the rise [...]

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IndexIQ Files For International Small Cap, Asian Tiger ETFs

Michael Johnston — Tue, 08 Mar 2011 12:00:02 +0000

IndexIQ, the firm known for pioneering the hedge fund replication ETF space, recently made an SEC filing detailing plans for close to a dozen new funds targeting international equity markets. The filing was light on details such as ticker symbols or expense ratios, but highlighted the investment objectives for the innovative funds: IQ Mexico Small Cap ETF: Linked to the IQ Mexico Small Cap Index. IQ Asian Tigers ETF: Linked to the IQ Asian Tigers Index, which consists of stocks listed on an exchange in Hong Kong, Indonesia, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam. IQ Asian Tigers Consumer ETF: Linked to the IQ Asian Tigers Consumer Index, which consists of stocks in the consumer sector in the Asian Tiger economies. IQ Asian Tigers Small Cap ETF: Linked to the IQ Asian Tigers Small Cap Index. IQ Asia Pacific ex-Japan Small Cap ETF: Linked to an index consisting [...]

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Using ETFs To Access Alternatives

Michael Johnston — Tue, 08 Feb 2011 22:00:08 +0000

The introduction and rapid expansion of the ETF industry has no doubt been a very positive development for investors big and small. The low fees characteristic of the exchange-traded structure have allowed cost-conscious investors to minimize expenses without sacrificing returns, while the enhanced tax efficiency and intraday trading capabilities have contributed increased flexibility to the investing public. As ETFs have gained traction with investors, the size of the product lineup has grown rapidly. What was relatively recently a few hundred funds offering exposure to “plain vanilla” stock and bond benchmarks has quickly grown to a stable of more than 1,100 exchange-traded products covering nearly every nook and cranny of the investable universe. This proliferation of ETFs has given investors more precise tools for accessing traditional asset classes, but it has also opened up investment strategies and asset classes that were previously either out-of-reach or that required considerable time and/or expenses [...]

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Best ETF Performers Of 2010: Winners For Every ETFdb Category

Michael Johnston — Wed, 05 Jan 2011 12:00:23 +0000

Last year was a good year for most asset classes, as investor portfolios continued to recover from the recent recession. The difference in performance between many comparable funds was significant, and many of the best performers of 2010 are relatively small funds that maintain considerably smaller asset bases than their more popular competitors. Below, we profiled the top performing ETFs in more than 60 ETFdb Categories covering all major asset classes. ETFs that launched in 2010 were excluded, as were those that stopped trading during the year [for more ETF insights, sign up for our free ETF newsletter]: Equity ETFs Many equity ETFs turned impressive performances in 2010; below, we profile the best of the best: All Cap Equities: The First Trust Multi CG AlphaDex (FAD) added 25.2% last year, besting the more popular VTI (up 17.4%) and IWV (up 16.8%) by a wide margin. Large Cap Blend Equities: The [...]

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ETF Pipeline Grows: More Hedge Fund Products, VIX ETNs In The Works

Michael Johnston — Fri, 05 Nov 2010 11:00:48 +0000

Less than a week into November, the month is shaping up to be one of the most active in recent memory for the ETF industry. Vanguard (international real estate ETF), UBS (another MLP ETN), PIMCO (laddered Treasury fund), and Global X (Gold Explorers) have already launched new ETFs, and several more issuers are expected to debut new products in coming weeks. And as new funds hit the market, the product pipeline is quickly refilled with ideas for new products. One of the more interesting filings to hit the SEC’s desk this week came from ProShares, which detailed plans for its Hedge Fund Replication ETF. The proposed fund would track the performance of the Merrill Lynch Factor Model – Exchange Series. That benchmark is designed to maintain a high correlation with hedge fund beta, as represented by the HFRI Fund Weighted Composite Index, an equally-weighted composite of more than 2,000 constituent [...]

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Closer Look At Hedge Fund ETFs

Michael Johnston — Tue, 27 Jul 2010 16:43:35 +0000

The past few years have seen no shortage of innovation in the ETF space; targeted international products, state-specific funds, and single-commodity ETPs are just a few of the developments to come out of the rapidly-expanding industry. Some of the most interesting products to hit the market recently are found in the Hedge Funds ETFdb Category, offering exposure to strategies that have historically been off limits to most investors. Many investors have some misconceptions about the hedge fund asset class; stories of outrageous returns generated in the 1990s and early 2000s have led them to believe that hedge funds seek to generate massive absolute returns by taking on significant risk. But in reality, hedge funds aren’t always out to generate eye-popping absolute returns. As the very name of these vehicles suggests, most hedge funds are designed to hedge, dampening volatility and providing diversification benefits to traditional stock-and-bond portfolios [see Early Leaders [...]

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Talking Hedge Fund ETFs, Inflation-Proofing, And More With Adam Patti

Michael Johnston — Tue, 27 Jul 2010 15:29:18 +0000

Adam Patti is the Chief Executive Officer and Founder of IndexIQ, a New York-based ETF issuer behind several of the most innovative ETF products to hit the market in recent years. He recently took time out of his busy schedule to discuss commodity investing, ETF options for protecting against inflation, and replicating hedge fund-like returns through ETFs. ETF Database (ETFdb): IndexIQ is perhaps best known for its hedge fund replication ETFs, including the Multi-Strategy Tracker ETF (QAI) and IQ Hedge Macro Tracker ETF (MCRO). Why might investors want exposure to a hedge fund-like asset? Adam Patti (AP): First off, there are some misconceptions about this asset class; many investors think that hedge funds are designed to “shoot the lights out” in terms of performance, because they hear all these fantastic numbers that some of these hedge funds put up once in a while. The reality is that hedge funds, as [...]

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Advanced ETF Investing: Acquired Fund Fees

Michael Johnston — Wed, 21 Apr 2010 15:01:52 +0000

Once investors have narrowed down the universe of 900+ exchange-traded products to those that could potentially match the risk/return profile they’re seeking, the real work begins (see Five Free Tools For Finding The Right ETF). When comparing ETFs to find the best fit for a portfolio, one of the metrics most frequently analyzed is the fee structure. While differences in expense ratios may not have a material impact on short-term trades, the long-term impact of compounding costs for buy-and-holders can be significant (see other metrics to consider when comparing ETFs). In most cases, comparison of fees is a relatively straightforward process; the expense ratio for each ETF is readily available from the issuer Web site (or for download from the ETF Screener). But occasionally ETFs will display multiple expense ratios or something called “acquired fees & expenses” (the adjacent image is from the home page for the iShares S&P Aggressive [...]

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ETF Database » MCRO

How Have The Hedge Fund ETFs Held Up In The Crisis?

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ProShares Launches Hedge Fund Replication ETF (HDG)

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How ETFs Have Democratized Investing

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IndexIQ Files For International Small Cap, Asian Tiger ETFs

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Using ETFs To Access Alternatives

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Best ETF Performers Of 2010: Winners For Every ETFdb Category

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ETF Pipeline Grows: More Hedge Fund Products, VIX ETNs In The Works

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Closer Look At Hedge Fund ETFs

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Talking Hedge Fund ETFs, Inflation-Proofing, And More With Adam Patti

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Advanced ETF Investing: Acquired Fund Fees

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