IndexIQ Announces Launch of the IQ Leaders GTAA Tracker ETF
New fund (ticker: QGTA) the first of its kind, provides cost effective, tax efficient exposure to the performance characteristics of the leading global allocation mutual funds
RYE BROOK, NEW YORK, September 30, 2015 – IndexIQ a leading provider of innovative investment solutions, today announced the launch of the IQ Leaders GTAA Tracker ETF (NYSE Arca: QGTA). This first of its kind ETF provides exposure to the performance and risk characteristics of the leading global allocation mutual funds.
“While the global allocation mutual fund category has been growing over the past few years, assets are highly concentrated among a handful of funds,” said Adam Patti, CEO of IndexIQ. “Our research has found that global allocation mutual funds, when aggregated, display significant exposures to a set of common asset classes, which spurred the idea behind QGTA; namely that we build an index that has similar exposures to the same asset classes and then create an Exchange Traded Fund to provide exposure to those returns with the price and tax efficiency inherent in the ETF structure, while also eliminating idiosyncratic manager risk.”
Similar to IndexIQ’s pioneering IQ Hedge Multi-Strategy Tracker ETF (NYSE Arca: QAI), QGTA is a fund-of-funds that invests in the components of an underlying index. This index utilizes a proprietary methodology that incorporates a number of factors, including performance and asset size, to identify the leading global allocation mutual funds. QGTA does not invest in these mutual funds itself, but rather in a portfolio of highly liquid, low-cost ETFs that, when taken as a whole, is designed to replicate leading global allocation mutual funds’ aggregate performance.
“QAI was the first liquid alternative ETF when it went live in 2009, and it remains the largest in the category, with more than $1 billion in assets,” continued Patti. “In looking for new areas where we could deliver value and unique exposures to investors and advisors, it became clear to us that a similar approach to that behind our successful line of hedge fund replication vehicles could be ported over to the mutual fund world.”
“Since 2007, our replication technology has proven to successfully replicate opaque hedge fund strategies,” continued Patti. “This same technology is being used to provide the performance of market leading global allocation mutual funds, however with a lower fee, far greater tax efficiency and full transparency.”
QGTA will have a management fee of 45 basis points, a significantly lower management fee level compared to the top five global allocation funds by assets, which have management fees ranging from 56 bps to 90 bps. The tax efficiency of the ETF structure may also enhance the relative performance of QGTA versus the mutual fund category.
QGTA is the sixth new ETF from IndexIQ to come to market this year, joining the following:
- IQ Hedge Long/Short Tracker ETF (NYSE Arca: QLS);
- IQ Hedge Event-Driven Tracker ETF (NYSE Arca: QED);
- IQ 50 Percent Hedged FTSE International ETF (NYSE Arca: HFXI);
- IQ 50 Percent Hedged FTSE Europe ETF (NYSE Arca: HFXE); and
- IQ 50 Percent Hedged FTSE Japan ETF (NYSE Arca: HFXJ).
IndexIQ is a pioneer and leading provider of innovative investment solutions focused on absolute return, real assets, and international strategies. IndexIQ’s solutions are offered as ETFs, mutual funds, separately managed accounts, and ETF model portfolios. The company's philosophy is to democratize investment management by providing all investors with cost-effective access to the types of high-quality, sophisticated investment products that typically have been reserved for institutional and ultra high-net-worth investors. Founded upon cutting-edge academic research, IndexIQ’s mission is to take indexing to the next level by combining the best attributes of both passive and active investing, and make strategies available to investors in low cost, liquid, and transparent products*. IndexIQ is an indirect, wholly-owned subsidiary of New York Life Insurance Company. Additional information about the IndexIQ and its products can be found at IQetfs.com.
Consider the Funds’ investment objectives, risks, and charges and expenses carefully before investing. The prospectus and the statement of additional information include this and other relevant information about the Funds and are available by visiting IQetfs.com or calling 888-934-0777. Read the prospectus carefully before investing.
IndexIQ® is the indirect wholly owned subsidiary of New York Life Investment Management Holdings LLC. ALPS Distributors, Inc. (ALPS) is the principal underwriter of the ETFs. NYLIFE Distributors LLC is a distributor of the ETFs and the principal underwriter of the mutual fund. NYLIFE Distributors LLC is located at 169 Lackawanna Ave, Parsippany, NJ 07054. ALPS Distributors, Inc. is not affiliated with NYLIFE Distributors LLC. NYLIFE Distributors LLC is a Member FINRA/SIPC.
*IndexIQ’s ETF holdings are available daily on IndexIQ’s website. Brokerage commissions apply to ETFs. ETFs are liquid in that they are exchange-traded.
Index performance does not reflect charges and expenses associated with the Funds or brokerage commissions associated with buying and selling ETF shares. One cannot invest directly in an index.
The IQ Hedge Multi-Strategy Tracker ETF (IQ Multi-Strategy ETF), the IQ Hedge Long/Short Tracker ETF (QLS ETF), and the IQ Hedge Event-Driven Tracker ETF (QED ETF) are not hedge funds and do not invest in hedge funds. The IQ Leaders GTAA Tracker ETF (QGTA ETF) is not a mutual fund and does not invest in mutual funds. There can be no assurance that the Funds’ investment strategies will be successful. The investment performance of the IQ Multi-Strategy ETF, the QLS ETF, the QED ETF, and QGTA ETF (collectively, the IQ ETFs), because they are funds of funds, depends on the investment performance of the underlying ETFs in which they invest. There is no guarantee that the IQ ETFs themselves, or each of the underlying ETFs in the Funds’ portfolios, will perform exactly as its underlying index. The non-diversified IQ ETFs are susceptible to greater losses if a single portfolio investment declines than would a diversified mutual fund. The IQ ETFs’ 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 IQ ETF’s underlying ETFs to be more volatile than if the underlying ETFs had not been leveraged.
For additional information, please contact:
Chris Sullivan/Mike MacMillan
New York Life Insurance