The PowerShares Multi-Strategy Alternative Portfolio (LALT) is expected to launch on May 29th and is supported by a partnership between Invesco and Morgan Stanley.
As described by Dan Draper, Invesco PowerShares Managing Director of Global ETFs: “One of the primary goals for investors that use alternative strategies is to minimize exposure to equity and bond markets, and to achieve better risk-adjusted returns compared to portfolios consisting only of traditional asset classes. LALT is an actively managed long-short strategy that seeks to provide efficient exposure to a broad mix of alternative-asset classes.”
The Etracs Fisher-Gartman Risk Off ETF (OFF) and the Etracs Fisher-Gartman Risk On ETF (ONN) will be called for redemption on May 9th after roughly 2.5 years of trading.
OFF provides inverse exposure to an index of long positions in risk-on instruments and short positions in risk-off instruments; ONN tracks an index with 150% in long positions in securities that gain in a strong market and 50% in short positions expected to fall in a strong market.
UBS gave no further details on the reason for redemption in the NYSE communique.
To those who remember the risk on/risk off days of 2011 when the entire universe of assets seemingly moved together based on the utterings of some politician here or across the pond, today is quite a different matter. The instances of days in which more than 90% of S&P 500 stocks move together have all but vanished late last year and this year.
The 65-day average correlation of stocks fell to 0.52% in January vs. an average of 0.63% between 2009 and 2013 (it rose as high as 0.84% late in 2011).
Investors have responded by moving money into so-called actively managed strategies, with those funds seeing inflows of $1.3B this year on top of $9.8B in 2013. It's a small amount, but contrasts with $360B pulled out of such funds between 2009-2012.
AUM at the year-old Global X Top Guru Holdings ETF (GURU) are up more than 1,000% YTD as its strong performance (up more than 40% since inception vs. about 30% for the SPY) lures investors. The fund invests by studying 13F filings and rebalances quarterly. Other funds based on hedge fund positions - ALFA and QAI - are also trailing GURU.
ProShares lowered fees yesterday on its Credit Suisse 130/30 ETF (CSM) to 0.45% from an earlier 0.95%. ProShares is the first to cut fees for ETFs in this class, where investors are looking to outperform large-cap indexes. The fund's also getting a truer name (ProShares Large Cap Core Plus), but no change to holdings and strategy. Competitors: JFT, HDG, ALFA, GURU