AlphaClone has launched AlphaClone International Downside Hedged Index, which seeks to give investors the potential to outperform broader international markets by accessing the investment ideas of the world’s most established hedge funds.
The index follows the same proprietary Clone Score methodology used by AlphaClone’s flagship AlphaClone Hedge Fund Downside Hedged Index, which has approximately $170m in assets currently tracking the index.
Earlier in the year, the firm filed with the Securities and Exchange Commission to register four new exchange-traded funds (ETFs).
The ETF that will track the AlphaClone International Downside Hedged Index is anticipated to launch before the end of 2015.
AlphaClone CEO Maz Jadallah said: "Pursuing the potential for alpha is even more important today for long-term investors, given the anemic growth forecasted for equities and bonds over the next several years.
"We’re delighted to introduce an international version of our index, further expanding the number of alpha-seeking index strategies available to global investors."
The AlphaClone International Downside Hedged Index comprises at least 40 high conviction American Depository Receipt (ADR) holdings selected from the regulatory disclosures of the world’s most established institutional investors, the company said.
The firm added that it uses its proprietary Clone Score methodology to continuously score managers based on the efficacy of following their disclosures, then aggregates high conviction ADR holdings from managers with the highest score.
Holdings are weighted based on the number of holders in each. The index also employs the firm’s innovative dynamic hedge mechanism that allows the index to vary from long only to market hedged when the S&P 500 closes below its 200-day simple moving average at any month’s end.
"Having seen success with our methodology inside separately managed accounts over the past five years, we’re excited to further expand access to our innovative investment methodology and are committed to helping long-term investors succeed," Jadallah added.