Hedge funds are reserved for ultra-rich investors and institutions, but a new exchange traded fund brings their sophisticated strategies to average people.
The IQ Hedge Multi-Strategy Tracker ETF (QAI Quote) started trading last week. It replicates the tactics hedge funds are famous for, such as short selling and arbitrage, by investing in other ETFs.
Hedge funds are known to generate returns even if the stock market drops, but that performance usually comes at a high cost. The IQ Hedge fund takes 0.75% for fees and costs, topping the expense ratios of more common funds like PowerShares QQQ(QQQQ Quote) and the SPDR S&P 500 ETF(SPY Quote), which charge 0.2% and 0.1%, respectively. But if the fund delivers better risk-adjusted returns than a stock ETF, it might be worth the higher cost. ...
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