UBS has launched four new ETFs offering exposure to individual hedge fund strategies, based on indices supplied and calculated by Hedge Fund Research.

The UBS HFRX equity hedge index, HFRX event-driven index, HFRX macro CTA index and HFRX relative value arbitrage index ETFs were listed on the German Stock Exchange on Friday 15 June and carry individual total expense ratios of 1.5% a year. Management and performance fees will also be payable on the hedge funds underlying each index.

The ETFs use funded swaps to track their indices and have a base currency of euro.

The HFRX equity hedge index tracks funds investing primarily in equities and equity derivatives, taking both long and short positions.

The HFRX event-driven index focuses on companies that are undergoing change, for example, due to mergers, restructuring measures, financing difficulties, takeover offers, share buy-back programs or security issues. 

The HFRX macro CTA index takes key economic indicators and their impact on equity, bond, currency and commodity markets into account. In selecting individual instruments, fund managers perform discretionary as well as systematic analyses, use top-down and bottom-up techniques, take qualitative and fundamental approaches, and go long and short. 

The HFRX relative value arbitrage index tracks fund managers who aim to take advantage of price inefficiencies between securities linked to each other. These may be equities, bonds, derivatives or other groups of instruments.

UBS has been operating an ETF offering exposure to the headline HFRX global hedge fund index since October 2010. The fund has €72 million under management and has lost 8% since inception.

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