Invesco PowerShares to launch multi-strategy alternative ETF in partnership with Morgan Stanley

May 14th, 2014 | By | Category: Alternatives / Multi-Asset

Invesco PowerShares, a leading global provider of exchange-traded funds, is set to unveil the PowerShares Multi-Strategy Alternative Portfolio (LALT), an actively managed multi-strategy alternatives ETF in partnership with Morgan Stanley.

Invesco PowerShares to launch multi-strategy alternative ETF in partnership with Morgan Stanley

Dan Draper, managing director of global ETFs at Invesco PowerShares.

The fund, scheduled to list on Nasdaq on May 29, 2014, is designed to help investors achieve lower portfolio volatility and enhance risk-adjusted returns.

“One of the primary goals for investors that use alternative strategies is to minimize exposure to equity and bond markets, and to achieve better risk-adjusted returns compared to portfolios consisting only of traditional asset classes,” said Dan Draper, Invesco PowerShares Managing Director of Global ETFs. “LALT is an actively managed long-short strategy that seeks to provide efficient exposure to a broad mix of alternative-asset classes.”

The fund is benchmarked against the Morgan Stanley Multi-Strategy Alternative Index, a proprietary index developed and used by Morgan Stanley’s Sales & Trading Division. The index is composed of a combination of quantitative, rules-based strategies, some of which have been used for years as benchmarks for products offered to institutional investors. Since the benchmark’s underlying strategies draw returns from different risk sources, combining the strategies may result in further diversification and risk reduction.

“Morgan Stanley has an established platform of proprietary liquid alternative indices across asset classes,” said Nikki Tippins, Managing Director, Head of Americas Equity Derivatives Distribution. “The Morgan Stanley Multi-Strategy Alternative Index is designed to combine such strategies that seek to offer attractive risk-adjusted returns with low correlation to traditional asset classes. We’re delighted to provide this benchmark for such an original ETF.”

“We are excited to partner with Morgan Stanley to offer a unique solution using institutional alternative strategies delivered in a liquid, transparent and lower cost exchange-traded vehicle,” added Lorraine Wang, Invesco PowerShares Global Head of ETF Products and Research. “As interest rates begin to normalize, we believe LALT can serve as an attractive alternative allocation for traditional stock/bond portfolios, to help investors better manage volatility and enhance risk-adjusted returns.”

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