IndexIQ has changed the expense ratios for nearly half of its ETFs, penciling in not just a number of fee cuts but also fee increases in a lineup that includes its most popular strategy, the $1 billion IQ Hedge Multi-Strategy Tracker ETF (QAI).
Four ETFs saw their fees lowered, effective this week, with the reductions ranging from 1 to 9 basis points. The funds each have assets ranging from $4 million to $187 million.
Six ETFs, including QAI, had their expense ratios increased anywhere from 1 to 13 basis points in a move that’s relatively unusual in the ETF space these days, where competitiveness over costs is frequently referred to as “a race to the bottom.” The changes come on the heels of a round of fee cuts by iShares earlier this month.
The fee reductions include:
- IQ Enhanced Core Bond U.S. ETF (AGGE) now costs 0.32%, down from 0.34%
- IQ Hedge Macro Tracker ETF (MCRO) now costs 1.00%, down from 1.02%
- IQ Hedge Long/Short Tracker ETF (QLS) now costs 1.00%, down from 1.09%
- IQ Global Resources ETF (GRES) now costs 0.77%, down from 0.78%
The fee increases include:
- IQ Hedge Multi-Strategy Tracker ETF (QAI) now costs 0.98%, up from 0.96%
- IQ Enhanced Core Plus Bond U.S. ETF (AGGP) now costs 0.39%, up from 0.35%
- IQ Real Return ETF (CPI) now costs 0.66%, up from 0.62%
- IQ Leaders GTAA Tracker ETF (QGTA) now costs 0.68%, up from 0.55%
- IQ Hedge Market Neutral Tracker ETF (QMN) now costs 0.95%, up from 0.94%
- IQ Global Oil Small Cap ETF (IOIL) now costs 0.79%, up from 0.76%
IndexIQ was not immediately available to comment on the changes. However, almost all of the changes affected ETFs that invest primarily in other ETFs. Those funds’ expense ratios are at least partially dependent on the expense ratios of their holdings, so if changes were made to the portfolio, they could easily impact the overall cost of the fund.
IOIL and GRES are not ETFs-of-ETFs, but at least with IOIL, the reason for the bump in price is fairly clear. The fund has less than $3 million in assets, has seen massive outflows relative to its size and has been on a downward-sloping trajectory for most of 2017.
Contact Cinthia Murphy at [email protected]