IndexIQ slashes fees on 50% hedged international equity ETFs

Jul 13th, 2017 | By | Category: Equities

New York-based asset manager IndexIQ has lowered the total expense ratios (TERs) for its suite of 50 percent currency hedged international equity ETFs.

IndexIQ’s chief investment officer Salvatore Bruno

IndexIQ’s chief investment officer Salvatore Bruno.

Launched in July 2015, the NYSE Arca-listed ETFs provide exposure to international, European and Japanese equities by tracking indices developed by FTSE Russell. For each fund, approximately half of the respective index exposure is hedged against the US dollar on a monthly basis.

The funds’ ‘neutral’ currency hedging strategy aims to smooth the effects of international currency movements without taking a definitive stance on the direction of the US dollar.

Following the move to lower fees, the IQ 50 Percent Hedged FTSE International ETF (HFXI) has seen its TER reduced from 0.36% to 0.20%, while the IQ 50 Percent Hedged FTSE Europe ETF (HFXE) and the IQ 50 Percent Hedged FTSE Japan ETF (HFXJ) have seen their TERs reduced from 0.46% to 0.30%.

“We’re pleased to make it more cost-efficient for investors to access the benefits of our 50 percent hedged suite of international equity ETFs,” said IndexIQ’s chief investment officer Salvatore Bruno. “With these lower fees, this innovative family of funds is even better positioned for future growth.”

As of the end of June 2017, HFXI, HFXE and HFXJ have gained 22.1%, 21.0% and 25.5% respectively.

“HFXI and the other funds in this product suite have performed exactly as designed since we launched them in July of 2015, even as Brexit, the results of the US election, and a push for a weaker dollar have whipsawed the currency market in different and frequently counterintuitive ways,” added Bruno.

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