IndexIQ, a leading developer of index-based liquid alternative investment solutions, saw assets under management (AUM) jump 37 percent in 2013 to $1.125 billion, driven in part by its IQ Hedge Multi-Strategy Tracker ETF (NYSE Arca: QAI ), the first hedge fund-style ETF and the industry’s largest alternative exchange-traded fund, which more than doubled in size during the period, ending the year with nearly $630 million in assets. In addition, IndexIQ continued to invest in its future growth during the year, expanding the sales force to include two new external wholesalers, covering the western and eastern territories, and bringing three new internal wholesalers on board.
“We are pleased to see our education-focused approach to the market recognized by financial advisors and investors during 2013, with our families of liquid alternative ETFs and real asset ETFs attracting new assets,” said Adam Patti, chief executive officer at IndexIQ.
“QAI in particular is viewed as a potentially strong alternative for investors looking to generate income but concerned about the potential impact of rising interest rates on bonds. Investors are seeking alternatives to their fixed income allocations, and QAI has proven itself an excellent choice, having outperformed the aggregate bond market in 2013 by 7.5% * with a similar volatility profile.” As of December 31, 2013, QAI performed as follows:
|Quarter||1 Year||3 Year||
Since Fund Inception*
|QAI Share Price||2.69%||5.49%||3.14%||4.46%|
|Barclays Capital US Aggregate Index||-0.14%||-2.02%||3.26%||4.73%|
*QAI inception date is March 25, 2009. Performance greater than 1 year is annualized. The performance data quoted above represents past performance, which is not a guarantee of future results. Investment return and value of the Fund 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 . QAI’s expense ratio is 0.75%. ROOF’s expense ratio is 0.69%.IndexIQ’s IQ US Real Estate Small Cap ETF (NYSE Arca: ROOF ) has been one of the leading ETFs in its category. ROOF’s indicated annual yield, which is the most recent quarterly yield multiplied by four, is approximately 9.40 percent, while the yield for the trailing four quarters was 7.25 percent, and the 30-day SEC yield as of December 31, 2013 is 5.26 percent. The firm’s IQ Merger Arbitrage ETF (NYSE Arca: MNA ) has provided a low cost vehicle for gaining access to the growing activity in mergers and acquisitions. “This investment area is heating up significantly given the trillions in cash on the balance sheets of companies around the world,” Patti said. IndexIQ and its ETFs continued to win recognition for their unique product line in 2013. The firm was recognized as “Most Innovative North American ETF Provider” by etfexpress, while IndexIQ’s products also garnered industry recognition. The IQ Hedge Market Neutral Tracker ETF (NYSE Arca: QMN ) was named “Most Innovative ETF” at the 9 th annual Global ETF Awards, while QMN’s assets grew nearly 170% during the year. Family of ETFs offer unique market exposure The IndexIQ family of ETFs continued to perform strongly relative to their benchmarks and peers. "With our small cap ETFs, the goal is to add value and diversification to investor portfolios,” Patti said. “Most ETF investors focus on buying the same large cap sector ETFs that most other advisors buy. Given the billions flowing into these large cap ETFs, and the often severe concentration within the top 10 holdings of those products, much of the diversification benefits are washed away. Small cap companies often grow faster than their larger competitors, and may offer an effective pure-play on an industry or a single country economy. Moreover, small caps often are under-represented in investors’ portfolios relative to the large cap ETFs, and are subject to being acquired, all characteristics that can make this segment of the market particularly attractive.”