Foreign securities can be subject to greater risks than U.S. investments, including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information, and changes in tax or currency laws or monetary policy. These risks are likely to be greater for emerging markets than in developed markets.
Large-Capitalization Companies Risk: Large-capitalization companies may be less able than smaller capitalization companies to adapt to changing market conditions. Large-capitalization companies may be more mature and subject to more limited growth potential compared with smaller capitalization companies. During different market cycles, the performance of large-capitalization companies has trailed the overall performance of the broader securities markets.
New Fund Risk The Fund is a new fund. As a new fund, there can be no assurance that it will grow to or maintain an economically viable size, in which case it could ultimately liquidate.
Small and mid-cap stocks are often more volatile than large-cap stocks. Smaller companies generally face higher risks due to their limited product lines, markets and financial markets.
ESG Investing Style Risk: Impact investing and/or Environmental, Social and Governance (ESG) managers may take into consideration factors beyond traditional financial information to select securities, which could result in relative investment performance deviating from other strategies or broad market benchmarks, depending on whether such sectors or investments are in or out of favor in the market. Further, ESG strategies may rely on certain values based criteria to eliminate exposures found in similar strategies or broad market benchmarks, which could also result in relative investment performance deviating. There is no assurance that employing ESG strategies will result in more favorable investment performance.
Cleaner Transport Investing Style. The returns on a portfolio of securities that excludes companies that have not adopted practices and policies [to support the transition to more efficient transportation technologies] may trail the returns on a portfolio of securities that includes companies that have not adopted these practices and policies. Investing only in a portfolio of securities [of companies that help to achieve cleaner transportation] may affect the Fund’s exposure to certain types of investments and may adversely impact the Fund’s performance depending on whether such investments are in or out of favor in the market.
The IQ Candriam Cleaner Transport Index incorporates thematic selection criteria designed to provide exposure to equity securities of companies that support the transition to more environmentally efficient transportation technologies, such as electric vehicles, bicycles, motor vehicle parts manufacturers, and multi-passenger transportation. Companies selected for inclusion in the Index offer, support or enable cleaner transportation products and services.
“IQ Cleaner Transport ETF (the “Fund”) is offered by IndexIQ, the Fund’s sponsor, in alignment with the National Wildlife Federation (“NWF”). The Fund is designed to promote investment objectives consistent with NWF’s mission. Shares of the Fund are not sponsored, endorsed or promoted by NWF, and NWF is not an investment adviser or service provider to the Fund. NWF makes no representations or warranties regarding the performance of the Fund and will have no obligation or liability in connection with the Fund. The Fund’s sponsor, IndexIQ, and its affiliates are supporters of and donors to NWF and are making a substantial contribution to NWF in connection with NWF’s agreement to license use of its name and trademarks to IndexIQ and its affiliates. NYLIM and IndexIQ’s contribution to NWF is calculated on an annualized basis to be the lower of: (i) 0.045% of the Fund’s average daily net managed assets (the average daily value of the total assets of the Fund, less all accrued liabilities of the Fund and less any management fees waived by the Fund’s adviser or sub-adviser); or (ii) ten percent of the Fund’s net annual management fee taking into account all applicable fee waivers and expense reimbursements. NYLIM and IndexIQ will make annual minimum contributions to NWF of $30,000 in each of the years 2021 to 2025 so long as their commercial co-venture is in effect.”
“New York Life Investment Management LLC (“NYLIM”) and IndexIQ Advisors LLC (“IndexIQ”) are donors to and supporters of the National Wildlife Federation (”NWF”). NWF has authorized NYLIM and IndexIQ to reference its name and certain marks owned by NWF in connection with a commercial co-venture entered into between the Parties. None of the payments made by NYLIM and IndexIQ to NWF are in exchange for services provided by NWF.
1. Risky Business. “National Report: The Economic Risks of Climate Change in the United States.” Accessed 18 Sept. 2021 https://riskybusiness.org/report/national/
2. National Geographic. “Transportation and Climate Change.” Accessed 18 Sept. 2021 https://www.nationalgeographic.org/media/transportation-and-climate-change/#:~:text=Globally%2C%20transportation%20accounts%20for%20between,emissions%20per%20voyage%20per%20person
3. Our World in Data. “Renewable Energy.” Hannah Ritchie and Max Roser. Accessed 18 Sept. 2021 https://ourworldindata.org/renewable-energy
5. ReportLinker. “Clean Energy Market Forecast for 2027 – COVID Impact and Global Analysis by Type and End User, and Geography.” Published October 2020
6. Intrado, GlobalNewsWire. “Electric Vehicles Market ShareProjected to Reach USD 700 Billion with 22% CAGR By 2026: Facts & Factors.” Published January 21, 2021
7. University College London study. “US green economy worth $1.3 trillion per year.” Accessed 27 Sept. 2021. https://www.ucl.ac.uk/news/2019/oct/us-green-economy-worth-13-trillion-year