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Inside ETFs Conference

What Has Worked in Liquid Alternative ETFs

Andrew Beer, founder and managing member of Dynamic Beta Investments, talks liquid alternative ETFs at the Inside ETFs conference.

 

It's no surprise that most financial advisors have been disappointed with liquid alternatives strategies, says Andrew Beer, founder and managing member of Dynamic Beta Investments, at the Inside ETFs conference. 

Beer, who has been in the liquid alternatives space since 2007—before the space actually existed—said "the only thing that's really worked well are replication-based strategies." He said the key is not only to pick the right strategy—managed futures, equity long/short, etc.—but also the right manager. 

"It's almost the same as if you said you want exposure to small cap stocks and then picked a single stock," Beer said. "No one in their right mind would do it."

He said what's been successful hasn't been to invest in the hedge fund or strategy, but to mimic the performance of the best funds in the space.

"If you can do that, you can deliver equal or better returns but with low fees, daily liquidity and usually less risk," he said.

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