Surging Global Deal Volume Sends 'MNA' to Record High

The video tutorial discusses the IQ merger arbitrage ETF, known as MNA, which employs a standard arbitrage strategy used by hedge funds. The fund focuses on buying shares of firms targeted for takeovers and hedging the market using sector ETFs and swaps. Timing is crucial, as MNA only trades after official deal disclosures, aiming for small incremental returns. The fund's assets have grown significantly, with a focus on US pharma and defense sectors. Despite asset growth, MNA's returns lag behind the broader market, with an expense ratio of 77 basis points and hidden fees due to short positions.

What is the primary strategy used by the IQ Merger Arbitrage ETF?

• Focusing on high-dividend stocks

• Buying shares of firms marked for takeovers and partially hedging the market

• Investing in emerging markets

• Investing in technology startups

Which of the following companies was involved in a significant transaction announced in 2019?

• Apple

• Charles Schwab

• Google

• Tesla

What is the main focus of the current holdings of the MNA fund?

• Energy and utilities

• Retail and consumer goods

• Technology and finance

• Pharma and defense

What is the expense ratio of the MNA fund?

• 50 basis points

• 25 basis points

• 77 basis points

• 100 basis points

What notice does the MNA fund receive in the Bloomberg Intelligence traffic light system?

• Notice for high volatility

• Notice for low risk

• Notice for hidden fees

• Notice for high returns