QAI currently has an expense ratio of 0.79 percent–worlds away from the 2 percent/20-percent of profits standard charged by hedge funds.
A Battle-Tested Fund
By using a multi-strategy methodology, QAI can thrive in a market environment whether the bulls or bears are reigning. This speaks to the adaptability of QAI that Salvatore Bruno, Chief Investment Officer of IndexIQ, describes as a “mostly independent way of deriving returns from various types of risks in all markets, as an absolute return expectation should act.”
While QAI won’t thrive in a raging bull market like the current run compared to unfettered exposure to the S&P 500, it can meld with an investor’s portfolio if a market drawdown were to occur if the said investor is willing to assume the risk associated with multiple strategies.
Of course, with a 10-year history also comes a track record of consistent performance:
As the wall of worry climbs for investors in 2019–a more dovish Fed, trade negotiations, inverted yield curves, and a global economic slowdown, QAI has been able to generate a 3.67 percent return year-to-date while muting the recent volatility. As investors are becoming more tactical with their capital allocation, a fund like QAI is almost imperative in the current market landscape.
Even with a challenging end to 2018 that saw the S&P 500 lose 6.59 percent, QAI was able to limit the damage with almost half the loss–3.67percent.
The time-tested performance is a byproduct of the innovation that stems from the talent at IndexIQ. While QAI celebrates its 10-year anniversary, it’s also a celebration of how long IndexIQ has come.
“As the fund hits this 10-year mark, I find myself thinking back on those early days and looking at all we’ve accomplished with IndexIQ since then,” wrote Bruno. “We’re not the startup anymore. In fact, we’re now part of a leading global asset management organization with over $550 billion in assets under management.”
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