Extract below courtesy of Forbes.com
In what comes as the latest move by Goldman Sachs to grab a larger share of the rapidly-growing exchange-traded fund industry, the investment banking giant is looking to launch as many as 11 new ETFs in the near future. Goldman filed a request with the SEC last Friday (December 12) to list six ETFs that will rely on smart-beta investment strategies under the new ActiveBeta brand name, and another five ETFs that are hedge fund-themed. While the bank intends to list these ETFs on the NYSE Arca exchange, it has not revealed tickers or expense ratios for any of them.
Goldman has been looking for ways to grow its asset management business since the economic downturn of 2008, as it faces increasing pressure from regulators as well as investors to increase the share of less volatile revenue streams in its trading-focused business model. The increasing popularity of ETFs over recent years made the industry a top priority for Goldman, with the bank first revealing its intent in September by seeking the SEC’s approval for a series of active ETFs (see Goldman Details Plans To Foray Into Active ETF Market). Goldman was also involved in talks to acquire the New York-based ETF provider IndexIQ in October. Notably, Goldman’s decision to launch these 11 new ETFs comes shortly after IndexIQ’s acquisition by New York Life Insurance.
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Extract courtesy of reporting by FinAlternatives.com
New York Life Investment Management has acquired IndexIQ, a leader in the liquid alternative exchange-traded fund industry, for an undisclosed amount.
The high-profile acquisition is NYLIM’s first foray into the ETF space.
Upon closing of the transaction, IndexIQ will be integrated into NYLIM and marketed through New York Life’s MainStay Investments platform. It will add $1.5 billion to MainStay’s $101 billion in assets under management.
“Our entry into the ETF space is a significant leap forward for New York Life Investment Management and offers remarkable opportunities all around,” said Drew Lawton, NYLIM CEO, in a statement. “Retail and institutional investors are increasingly attracted to ETFs because they offer a cost-effective, transparent way to access investment opportunities across asset classes around the globe. IndexIQ has established itself as a true innovator and market leader offering the next generation of liquid alternative ETFs, and we intend to leverage IndexIQ’s capabilities to become the dominant provider of non-traditional ETF solutions to the market…At the same time, IndexIQ provides a robust ETF platform that New York Life can use to consider new and diverse offerings in the future.” more
MarketMuse update courtesy of exclusive reporting by Reuters’ Jessica Toonkel
On the heels of this week’s announcement by Janus Capital to acquire ETF Issuer VelocityShares, presumably as a vehicle for Bill Gross to further package his fixed-income strategies, and this past June’s announcement from the London Stock Exchange to acquire index specialist Frank Russell Company, the bubbling market for ETF platforms is bubbling even more..as evidenced by this scoop from Reuters’ Jessica Toonkel:
(Reuters) – Goldman Sachs Group is in discussions to acquire IndexIQ, a Rye Brook, New York-based exchange-traded fund provider, according to three sources familiar with the situation.
The deal, if finalized, would enable Goldman to introduce passively managed and actively-managed exchange traded funds within months.
A Goldman Sachs Asset Management spokeswoman declined to comment. A call and e-mail to Adam Patti, the chief executive of IndexIQ, was not immediately returned.
Courtesy of Carolyn Pairitz
While the U.S. markets continue their bull run to baffle even the best investors on Wall Street, the ETF market has started to take off in the last two weeks, with a number of new funds entering the space. After the slow down of new funds since mid-January, the solid economic data being released from around the world has helped issuers recognize that now is a great time for new funds. For some institutions its their first time venturing into the industry, while others are just adding to their army, as both Vanguard and IndexIQ have filed interesting proposals with the SEC [see ETF Database Launch Center].
California-based mutual fund firm, Franklin Templeton has filed for their very first ETF to meet the growing needs of their investors:
- Franklin Short Duration Government ETF: This actively-managed ETF will own U.S.-issued debt, ranging from Treasuries to mortgage-backed securities to create a shorter duration portfolio of bonds. Focusing on shorter duration bonds could prove to be a very popular investment theory, as many investors are starting to hedge their funds against the eventual rise in U.S. interest rates.
IndexIQhas laid the groundwork for two new domestic equity ETFs focused on driving growth and innovation:
- IQ Fastest Growing Companies ETF: This ETF will invest in 50 quickly growing U.S. companies, to be determined by a number of factors including sales, net income, cash flow growth and total return. This strategic exposure to companies that not only currently have high growth indicators but also have featured high returns in the past, may interest investors who are looking for a bit of a riskier play on the U.S. equities market.
- IQ Innovation Leaders ETF: Using a rule-based proprietary benchmark, this ETF is intended to invest in 100 companies that are seen as innovative based on their sales growth, research and development of assets and expenses, along with retained earnings growth. Another requirement of inclusion, these growing firms need to have a market cap of at least $300 and be a U.S. firm.
Courtesy of Ronald Delegge, ETFGuide.com
IndexIQ introduced the the IQ HedgeMarket Neutral Tracker ETF (QMN) in October. QMN is designed to offer investors liquid, transparent market neutral hedge fund exposure.
QMN will seek to track, before fees and expenses, the performance characteristics of the IQ Hedge Market Neutral Index (IQHGMN), part of IndexIQ’s proprietary IQ Hedge family of benchmark hedge fund replication indexes. The IQ Market Neutral Index (IQHGMN) has live performance dating from September 2008.
“Market neutral is one of the largest hedge fund investment styles, both in terms of the number of funds and in the amount of assets being put to work,” said Adam Patti, IndexIQ CEO. “After incubating the index underlying QMN for four years, we felt it was an excellent time to roll out this strategy, particularly given the volatility and uncertainty inherent in today’s market environment.
QMN is linked to the IQ Hedge Market Neutral Index and holds other ETFs within its portfolio. The top three holdings are the Vanguard Short-Term Bond ETF (BSV), iShares Barclays 1-3 Yr Treasury Bond Fund (SHY) and the Vanguard Total Bond Market ETF (BND).
QMN’s market neutral approach means that it can invest in both long and short positions in various asset classes. These strategies seek to have a zero “beta” or market exposure to one or more systematic risk factors including the overall market (as represented by the S&P 500 Index), economic sectors or industries, market cap, region and country. Market neutral strategies that effectively neutralize the market exposure are not impacted by directional moves in the market.
According to IndexIQ’s prospectus, QMN will charge annual expenses of 0.99%, which include the expenses of the underlying funds held within the portfolio.
How can you not keep reading after that shining headline?..courtesy of Jason Kephart over at InvestmentNews..
In the category of “what will they think of next?” IndexIQ has apparently scratched a new surface–IN reports that IQ has filed to offer the first physically-backed diamond ETF.
The IQ Physical Diamond Shares ETF will work along the same line as other physically backed precious metal ETFs, such as the $69 billion SPDR Gold Shares ETF (GLD). Rather than tracking an index, the ETF will be backed by a vault of actual diamonds in Antwerp, Belgium.
As the fund receives new money it will purchase more diamonds and as it loses money it will sell off the gems to pay for the redemption. One of the ‘ho-hums” in the filing is that this product isn’t going to attract Liz Taylor wanna-bees; IndexIQ intends to invest only in one-carat, industry-standard diamonds that are readily available and “in common use among diamond dealers,” according to its prospectus.
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