Newfound Research, a Boston-based quantitative investment advisor, and Nasdaq OMX Group, a leading exchange group and index provider, have agreed to collaborate on a range of rules-based investment strategy indices. The news indices, which will combine Newfound’s investment insight with Nasdaq OMX’s pedigree in the index space, will include a risk managed income strategy, a global defensive equity strategy, a target excess yield strategy and a US equity dynamic long/short strategy.

By David Stevenson – The idea of using ETFs to ‘clone’ or ‘replicate’ the trading strategies of hedge funds has always struck me as an idea too far for the passive funds sector. Let’s be honest, hedge funds tend to typify the polar opposite of what many ETF investors want to buy into. Most ETF investors I know are into low cost investments, passively managed, with low trading turnovers using a strategic approach to asset allocation – hedge funds represent the diametric opposite! So why on earth am I thinking about buying a US-listed ETF from Global X Funds that is in fact replicating major hedge funds?

Global X Funds, a New York-based provider of exchange-traded funds (ETFs), has announced that its hedge fund clone ETF, the Global X Top Guru Holdings Index ETF (GURU), has crossed the $100 million assets under management threshold.

Horizons USA, a member of the Horizons ETFs Group, has launched its first exchange-traded fund (ETF) in the United States. The launch expands Horizons’ international reach, which now includes operations in Canada, South Korea, Hong Kong and Australia. The firm’s debut US product, the Horizons S&P 500 Covered Call ETF (HSPX), provides exposure to the S&P 500 Index while also generating additional income through the sale of call options.

VelocityShares, a developer of alternative exchange-traded products perhaps best known for its occasionally notorious VIX ETNs, has rolled out two new innovative exchange-traded funds (ETFs) on the NYSE Arca. The funds are linked to proprietary in-house indices and provide exposure to a long/short volatility strategy combined with a large-cap US equity allocation.

IndexIQ, a US-based specialist provider of exchange-traded funds (ETFs), best known for its hedge fund-style products, has surpassed $1 billion in assets under management. Adam Patti, IndexIQ’s chief executive officer, said: “In a few short years, liquid alternatives have gone from a novelty to playing an important role in a diversified investment portfolio and we’ve seen strong interest in our offerings from the institutional and retail advisor channels.”

Stoxx, a leading index provider, has introduced the Euro Stoxx 50 BuyWrite 100% Index. The index measures the performance of a buy-write or covered-call strategy based on the Euro Stoxx 50 Index, the eurozone’s leading blue-chip equity index. The new index, which has been designed to underlie index-linked financial products such as exchange-traded funds (ETFs), represents a hypothetical portfolio of a long position in the Euro Stoxx 50 and a sold – or written – call option based on the same index.

MSCI, a leading global index provider, has broadened its suite of smart beta ‘risk premia’ indices with the introduction of the MSCI Momentum Indices, initially comprising the MSCI ACWI Momentum Index and MSCI USA Momentum Index. The new indices, which reflect the performance of an equity momentum strategy and can enhance portfolio returns and diversification, have already caught the eye of iShares, the world’s largest provider of exchange-traded funds (ETFs).

ALPS, a US-based provider of exchange-traded funds (ETFs), has announced the launch of the US Equity High Volatility Put Write Index ETF (HVPW) on the NYSE Arca. The fund provides investors with a regular income stream through the application of a put-write options trading strategy. This kind of strategy works well in trending bull markets, but can come under pressure when equity prices are declining.

International Securities Exchange (ISE) and IndexIQ have announced a broad partnership to develop and launch a range of exchange-traded products (ETPs) linked to physical commodities. While ISE is perhaps best known as a US options exchange, the company has an established index business and recently has manoeuvred itself deeper into the fast-growing ETP industry. The link-up with IndexIQ, a niche provider of alternative ETFs, looks well suited as both companies have a demonstrated pedigree in creating innovative products.