Two of the six IndexIQ Hedge Indexes were positive in November, led by a rise of 0.97 per cent in the IQ Merger Arbitrage Index, as markets reacted strongly in the wake of the US presidential election.
The IQ Hedge Long/Short Index was up 0.74 per cent in the month, while the IQ Hedge Multi-Strategy Index fell 1.22 per cent and the IQ Hedge Market Neutral Index declined 0.53 per cent.
"The election of Donald Trump sent the markets off in new directions, and began to break down some of the asset class correlations we've seen in recent years. Bonds sold off, small cap stocks outperformed, and many commodities and oil rallied," says Salvatore Bruno (pictured), IndexIQ's chief investment officer. "If we are in fact entering a period of diverging asset classes, this should create a favourable environment for many liquid alternative strategies, and investors should consider repositioning their portfolios accordingly."
Designed as investable benchmarks that replicate the performance characteristics of sophisticated hedge fund strategies, the IQ Hedge Indexes comprise the first family of investable benchmark indices covering hedge fund replication/alternative beta strategies.