First U.S.-Listed Hedge Fund Replication Exchange-Traded Fund Celebrates Three-Year Anniversary
The IQ Hedge Multi-Strategy Tracker ETF (NYSE Arca: QAI), the first U.S.-listed hedge fund replication Exchange-Traded Fund, celebrated its three-year anniversary on March 25, 2012, the fund’s sponsor, IndexIQ, has announced.
“We launched the IQ Hedge Multi-Strategy Tracker ETF in 2009 with the goal of making a whole new asset class available to the average investor,” said Adam Patti, CEO of IndexIQ. “Before the launch of QAI, hedge fund investing was generally limited to institutions and high net worth individuals. QAI changed all of that. While the concept was novel at the time, QAI has performed as we anticipated over the past three years and has attracted more than $200 million in assets.”
QAI is designed to give investors and their financial advisors access to institutional quality investment strategies in a low cost, fully transparent, and highly liquid vehicle. It seeks to replicate, before fees and expenses, the returns of the IQ® Hedge Multi-Strategy Index. The Index uses multiple hedge fund investment styles, including long/short equity, global macro, market neutral, event-driven, fixed income arbitrage, and emerging markets.
Since its launch, QAI has weathered a period of dramatic stock market volatility, providing annualized returns and standard deviation as of QAI’s 3-year anniversary date as follows:
Performance greater than 1 year is annualized. Performance data shown represents past performance and is not a guarantee of future results. Investment return and value of the Funds’ shares will fluctuate so that an investor’s shares, when sold, may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. Fund returns reflect dividends and capital gains distributions. Fund performance current to the most recent month-end is available by calling 1-888-934-0777 or by visiting www.IndexIQ.com. Expense ratio is 0.75% and total operating expenses is 1.06%.
“During this period of extraordinary turbulence, advisors, investors, institutions, and even other hedge funds have used QAI to maintain exposure to the markets at lower risk as measured by standard deviation,” said Patti. “It has proven to be a highly effective tool for diversifying a wide variety of portfolios.”
In addition to QAI, IndexIQ is also the sponsor of a number of liquid, index-based absolute return products designed to “democratize” the alternative investment landscape, including:
IndexIQ also offers its liquid alternative strategies via separate account and model ETF portfolios, making them the only firm to offer liquid alternative solutions via four separate product wrappers, including ETFs, Mutual Fund, Separate Accounts and Model Portfolios.
“We’re proud to have created one of the most comprehensive families of liquid alternative strategies available in the market today,” continued Patti. “We have continued our quest to identify opportunities for innovation in the liquid alternatives space in the years since we first brought QAI to market.”
IndexIQ also noted that it has formed several partnerships with large firms in the financial services and advisory spaces based on IndexIQ’s liquid alternative offerings since launching QAI, including Envestnet, which recently added IndexIQ’s Global Alternatives ETF Model Portfolio (of which QAI is a core holding) to its Liquid Alternatives Program; Fortigent, which added the IQ Hedge Multi-Strategy SMA Portfolio as an Alternative Investment solution for its customizable UMA program; and NATIXIS, which licensed a hedge fund replication composite index from IndexIQ for use in creating products for the European and Asian markets.
IndexIQ products are designed to be liquid, transparent, low cost, and accessible to a broad range of investors.*
IndexIQ is a leading issuer of index-based liquid alternative solutions focused on absolute return, real assets and international strategies. IndexIQ solutions are offered as ETFs, Mutual Funds & Separate Accounts. IndexIQ’s philosophy is to democratize investment management by making innovative alternative investment strategies available to investors in low cost, liquid and transparent products.* IndexIQ strategies are marketed through the company’s proprietary investment products and select partnerships with leading global financial institutions. Additional information about the company and its products can be found at www.IndexIQ.com.
*Ordinary brokerage commissions apply to ETFs. IndexIQ’s ETF holdings are available daily on IndexIQ’s website. ETFs are liquid in that they are exchange-traded.
Consider the Fund’s investment objectives, risks, charges and expenses carefully before investing. The prospectus and the statement of additional information include this and other relevant information about the Fund and are available by visiting www.indexiq.com or calling 1-888-934-0777. Read the prospectus carefully before investing.
QAI's investment performance, because it is a fund of funds, depends on the investment performance of the underlying ETFs in which it invests. There is no guarantee that the Fund itself, or any of the ETFs in the Fund's portfolio, will perform exactly as its underlying index. The Fund’s underlying ETFs invest in: foreign securities, which subject them to risk of loss not typically associated with domestic markets, such as currency fluctuations and political uncertainty; commodities markets, which subject them to greater volatility than investments in traditional securities, such as stocks and bonds; and fixed income securities, which subject them to credit risk – the possibility that the issuer of a security will be unable to make interest payments and/or repay the principal on its debt – and interest rate risk – changes in the value of a fixed-income security resulting from changes in interest rates. Leverage, including borrowing, will cause some of the Fund’s underlying ETFs to be more volatile than if the underlying ETFs had not been leveraged.
The Fund is distributed by ALPS Distributors, Inc. (ALPS), which is not affiliated with IndexIQ, and which does not distribute the SMA. IndexIQ Advisors distributes the SMA. Adam Patti is a registered representative of ALPS.
Mike MacMillan or Chris Sullivan, 212.473.4442
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