ETF News & Commentary
SAN DIEGO (ETFguide.com) - IndexIQ has just introduced two ETFs designed to hedge against rising inflation.
To date, investors have been limited in the tools they have available in their efforts to protect their assets against inflation,” said Adam Patti, CEO at IndexIQ. “With many forecasters believing that we are about to enter an extended period of greater inflationary pressures, we believe the time is right for a new approach to protecting wealth by seeking real return at or above the rate of inflation.”
The IQ CPI Inflation Hedged ETF (NYSEArca: CPI) attempts to hedge against changes in the U.S. inflation rate by providing a return above the rate of inflation as measured by the Consumer Price Index (CPI).
CPI uses a fund-of-fund strategy. Top holdings within CPI include the iShares Barclays Short Treasury Fund (NYSEArca: SHV), the SPDR Barclays Capital 1-3 Month T-Bill (NYSEArca: BIL) and the iShares Barclays 20+ Treasury Bond Fund (NYSEArca: TLT). The fund’s total annual fee including the cost of the underlying funds it owns is 0.65%.
The IQ ARB Global Resources ETF (NYSEArca: GRES) aims to hedge against inflation by owning a basket of commodity related stocks. GRES will compete with other commodity ETFs that employ a similar strategy like the Thomson Reuters/Jeffries CRB Global Commodity Index Fund (NYSEArca: CRBQ) and the Market Vectors RVE Hard Assets Producers ETF (NYSEArca: HAP). HAP was launched one year ago and has around $94 million in assets.
The annual expenses for GRES are 0.75%.
“These two new funds offer a sophisticated approach to hedging the impact of a broad based rise in price levels as measured by the CPI,” said Patti.
Recent Headlines
Brokerage Products and Services offered by Scottrade, Inc. - Member FINRA and SIPC
Online market and limit stock trades are just $7 for stocks priced $1 and above.
Any specific securities, or types of securities, used as examples are for demonstration purposes only. No information on this Web site should be considered a recommendation or None of the information provided should be considered a recommendation or solicitation to invest in, or liquidate, a particular security or type of security.
Investors should consider the investment objectives, risks, charges, and expenses of an ETF carefully before investing. For a prospectus containing this, and other important information, contact the fund company. The prospectus should be read carefully before investing.
Investors should consider the investment objectives, risks, and charges and expenses of a mutual fund carefully before investing. A mutual fund's prospectus contains this and other information about the mutual fund. Prospectuses are available through our trading site or through a Scottrade branch office. The prospectus should be read carefully before investing. No transaction fee (NTF) funds are subject to the terms and conditions of the NTF funds program. Scottrade is compensated by the funds participating in the NTF program through recordkeeping, shareholder, or SEC 12b-1 fees.
Investors should consider the investment objectives, charges, expense, and unique risk profile of an Exchange Traded Fund (ETF) carefully before investing. Leveraged and Inverse ETFs may not be suitable for long-term investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies. A prospectus contains this and other information about the ETF and should be obtained from the issuer. The prospectus should be read carefully before investing.
Margin trading involves interest charges and risks, including the potential to lose more than deposited, or the need to deposit additional collateral in a falling market. Margin Disclosure Statement (PDF) is available for download, or it is available at one of our branch offices. It contains information on our lending policies, interest charges, and the risks associated with margin accounts.
Options involve risk and are not appropriate for all investors. Detailed information about the risks associated with options can be found in the Scottrade Options Application and Agreement, Brokerage Account Agreement, or by downloading the Characteristics and Risks of Standardized Options and Supplements (PDF) from The Options Clearing Corporation, or by requesting a copy from your local branch office. Supporting documentation for any claims will be supplied upon request.
Market volatility, volume, and system availability may impact account access and trade execution.
Testimonials may not be representative of the experience of other clients and are no guarantee of future performance or success.