New ETFs: Hedge Fund Replication, Treasuries

November 4th at 1:00am by Tom Lydon

ProShares filed with the Securities and Exchange Commission (SEC) to launch a hedge-fund replication exchange traded fund (ETF) that’s linked to an index with high correlation with hedge fund beta.

ProShares’ Hedge Replication ETF is seeking ambitious results, as it is a proposed fund which will be able to invest long or short using ETFs, including those from ProShares and others. [A New ETF Provider Enters the Field.]

Olivier Ludwig for Index Universe explains that this ETF will join a growing field of funds that have hedge fund replication strategies, including:

  • Index IQ’s IQ Hedge Multi-Strategy Tracker (NYSEArca: QAI)
  • Mars Hill Global Relative Value ETF (NYSEArca: GRV)

The new fund will measure its correlation to hedge fund beta using the HFRI Fund Weighted Composite Index, an equally-weighted composite of more than 2,000 constituent funds. [New Tactical ETF Launches.]

Meanwhile, PIMCO launched another addition to its lineup of bond ETFs: the PIMCO Broad U.S. Treasury Index Fund (NYSEArca: TRSY), which gives exposure to the broad Treasury yield curve. The fund seeks to track the BofA Merrill Lynch Liquid U.S. Treasury Index, and the basket includes the three most recently issued two-year, three-year, five-year, seven-year, 10-year and 30-year U.S. Treasury bonds and notes.

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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