A New ETF For The M&A Play

The ETF Professor suggested an ETF earlier this week for those investors willing to bet on increased M&A activity, but the folks at IndexIQ have developed a new ETF for the same purposes.

IndexIQ is preparing to launch another fund, the IQ ARB Merger Arbitrage ETF later this month. The ETF will track track the IQ ARB Merger Arbitrage Index, which follows companies that have publicly announced takeovers. The index also features short positions in global stocks and equity market hedges.

The new ETF will trade under the cute ticker "MNA." Arbitrage trading is something that most investors should not get involved with on purpose and the ETF Professor imagines that this new ETF will either be thinly traded or extremely volatile.

The Professor maintains his stance that the ETF for the common investor play M&A activity with is the SPDR KBW Capital Markets (NYSE: KCE). Oh yeah, KCE is up since the Professor's initial recommendation earlier this week.


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Why would someone want to be

Why would someone want to be long leveraged financials like Goldman et al that have significant revenue outside m&a? MNA is a better way to play and will be less volatile than long only equities. Check out the iiq website for index performance.

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