Scalper1 News
Here it is. The end of another year. Time to look back and salute auld lang syne . But if you’re an investor in liquid alternatives, you learned to keep aspirin alongside your champagne ahead of the final closing bell of 2015. When we assessed the performance of 16 diverse alternative investment ETFs at this time in 2014 (see ” The Best and Worst Alternative Investment ETFs ), we found only one – an actively traded real estate portfolio – topping the performance of the S&P 500. In 2015, there were four outperformers. Good news? Sort of. In 2014, the blue chip index was cooking along with a nearly 15 percent gain. Now, the S&P was flat for the previous year. The performance bar’s been lowered BIG time. But outdoing the broad market’s gain isn’t what liquid alts are really designed to do. They’re supposed to provide uncorrelated returns. And on that score, alternative ETFs are pretty much doing what they did in 2014. The funds averaged a .24 correlation to the S&P 500 that year. The mean was .25 in 2015. Still, alt funds have struggled. In 2014, the 15 extant funds produced a mean 1.6 percent gain with a volatility of 9.1 percent. In 2015, they lost 2.5 percent, while cranking a 13.9 percent standard deviation. Most interesting, though, is the reversal of fortune for 2014’s worst performers. The QuantShares U.S. Market Neutral Momentum ETF (NYSEARCA: MOM ) took 15th place in 2014’s 16-fund derby, with an 8.4 percent loss. MOM comes in first now with a 23.5 percent gain, a real bottom-to-top turnaround when you consider that 2014’s last-placed ETF – the ProShares 30 Year TIPS/TSY Spread ETF (NYSEARCA: RINF ) – has since been shuttered. Coming in second in 2015 was the ProShares Global Listed Private Equity ETF (BATS: PEX ), a fund that limped across the finish line in 14th place in 2014 with a 5.4 percent loss. Click to enlarge Aside from these shifts, there wasn’t much movement in the table, though the WisdomTree Managed Futures Strategy ETF (NYSEARCA: WDTI ) moved up five notches with its 4.1 percent loss. Oddly enough, 2014’s 5.4 percent gain put WDTI in a rather lowly 10th place. Will history repeat? Will 2015’s last be this year’s first? For that to happen, you gotta believe in small stocks. Small stocks do tend to outperform large caps in rising rate environments, but I’d still keep that aspirin handy. Happy new year! Scalper1 News
Scalper1 News