A fund that we have not previously covered in this space comes from ProShares, an ETF issuer whom of course is known mostly for their leveraged long and short ETF offerings, and it is ALTS (ProShares Morningstar Alternatives Solution ETF, Expense Ratio 0.95%).

ALTS debuted in October of 2014, so it is rather fresh to market, and fits within the “Hedge Fund” category of ETFs within the greater “Alternatives” asset class. Still somewhat small with only $22.7 million in assets under
management, the fund takes on better known competitors in the space such as the largest ETF in the category which we have profiled time and again, QAI (IQ Hedge Multi-Strategy Tracker, Expense Ratio 0.75%, $994 million in AUM), WDTI (WT Managed Futures Strategy Fund, Expense Ratio 0.95%, $229 million in AUM), and RLY (SPDR Multi-Asset Real Return ETF, Expense Ratio 0.70%, $153 million in AUM).

The important takeaway from examining this category in general is that no fund or strategy is exactly alike the rest, much like actual hedge fund vehicles, in that strategies are largely designed differently, with different goals, and of course will have different investment outcomes depending on a multitude of factors.

Thus, individual fund due diligence is of utmost importance when delving into any fund or funds within this category when deciding where something may fit into the asset allocation picture in one’s portfolio. Live track record is of great importance as well for these vehicles, and we note that QAI for instance now has a 3-star Morningstar rating since it has traded on the open market since 2009.

Likewise, WDTI also has a 3-star Morningstar rating currently, although RLY and ALTS of course have not traded publicly long enough to earn a rating yet.

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