ProShares also launched the ProShares Managed Futures Strategy (NYSEArca: FUTS) earlier this month as a way of filling out all the asset classes necessary for the Morningstar Diversified Alternatives Index. Managed futures strategies are also used in asset classes such as bonds and currencies, aiming to garner value in a variety of market conditions. Managed futures portfolios have historically provided risk-adjusted returns comparable to those of stocks with low correlation to the stock and bond markets, according to ProShares. [ProShares Debuts Managed Futures ETFs]
“ALTS is a straightforward solution to access alternative asset classes, but folks want to dig into the product,” said Roberson. “We want to help people understand the index methodology, and Ibbotson will help in that process.”
Roberson points out that ALTS’ index methodology includes a momentum overlay, which allows the ETF’s holdings to be significantly reweighted, if circumstances dictate, at the fund’s monthly rebalances. Said differently, momentum is a key element in how ALTS’ holdings are weighted, according to Roberson.
Financial advisors who are interested in learning more about ALTS and how this new ETF can reduce correlations and volatility within client portfolios can register for the Thursday Oct. 30 webcast here.
ALTS Holdings
Table Courtesy: ProShares