Some ETFs accumulate an enormous amount of assets in the brewer's kettle. Other ETFs have taken a little more time to ferment. Still others have had plenty of yeast and plenty of time, but they haven't found enough takers for the batch.
Most notably, Index IQ delivered its first hedge fund multi-strategy tracker nearly 8 months ago, IQ Hedge Multi-Strategy Tracker ETF (QAI). The reader may wish to note... I was not exactly kind in my review.
My prior criticism centered on the fact that this particular Hedge Fund ETF didn't provide any of the benefits that ETFs are known for. If you want index fund transparency, tax-efficiency, higher volume liquidity for trading, and low expenses... IQ Hedge Multi-Strategy Tracker ETF (QAI) wasn't going to be your delivery vehicle.
Today, however, I am making an observation about Hedge Fund ETFs as a category. There have only been 2 Hedge Fund ETFs available on the U.S. exchanges for more than 6 months... and investors haven't exactly embraced them. QAI has only $75 million in assets since arriving in late March, whereas Index IQ Hedge Macro Tracker (MCRO) has less than $7 million since an early June arrival.
The question one might pose, then... Is there a lack of interest in emulating hedge funds through ETF investing or a lack of interest in what has been offered on the U.S. exchanges? The answer appears to be that there's questionable interest in the current offerings in the U.S.
Consider the evidence. With 3 months more time in the marketplace, Europeans have overwhelmingly embraced the db Hedge Fund ETF; its assets under management have swelled to more than $1 billion in less than 1 year!
The reason for greater intrigue abroad? Perhaps it is the simple fact that the db Hedge Fund ETF tracks an established index, the db Hedge Fund Index. Whereas QAI and MCRO in the U.S. are offering hedge fund strategies, the db Hedge Fund ETF is offering to track the performance of a diversified pool of hedge funds.
If you'd like to learn more about ETF investing... then tune into In the Money With Gary Gordon. You can listen to the show LIVE, via podcast or on your iPod.
Forex Trader Library
Receive over 15 hours (8 CD's) of our best Forex trading education in one package! Containing the newest Advanced Forex CD, this education pack focuses on exactly what you need to know to become a successful Forex Trader.