iQ-FOXX turns ATX annual loss 2018 from -20% to +20%

iQ-FOXX turns ATX annual loss 2018 from -20% to +20%

The Austrian share index ATX closed 2018 at 2,745.78 points. For the past year, this means a minus of 20 percent. The iQ-FOXX Austrian Stocks Alpha Index, on the other hand, completely reversed its performance and closed 2018 with a strong plus of +20.8%.

The 2018 stock market year did not bring much joy to investors in general. The ATX, Austria’s leading index, posted a price decline of almost 20 percent, the DAX was hardly any better and the American markets also turned negative at the end of the year. A slowdown in the global economy, the trade dispute between the USA and China and the imminent Brexit at the end of March had a much greater impact on the ATX companies than on companies in the USA.

For the ATX, it was the second largest annual loss in the last 10 years. Of the 20 ATX companies, only three closed 2018 with a positive result. CA IMMOBILIEN with an increase of +5.9%, DO & CO (+61.7%) and VERBUND (+89.9%). The remaining shares brought some severe losses, with the following three companies reporting the largest losses: VOESTALPINE AG (-48.6%), AT&S (-36.4%) and SCHOELLER-BLECKMANN (-31.1%). The year 2018 ended happier for licensees of iQ-FOXX indices.

Thus iQ-FOXX turned the result from -20% to +20%

Chart sources: iQ-FOXX, Bloomberg. Time span 01/2018 – 12/2018

Through the use of leverage and short positions, the iQ- FOXX Austrian Stocks Alpha Index succeeded in generating an outperformance of +40.5% in relation to the underlying index in 2018. The positive result for the year of +20.8% was mainly due to an outperformance in March (+6.2%), October (+15.0%) and December (+23.7%). The highest underperformance was recorded in July (-10.1%) and September (-2.7%).

Successful live track record since 2006

The iQ-FOXX indices have been in live operation since 2006. Since the start of the calculation in 1999, the iQ-FOXX Austrian Stocks Alpha Index has achieved a return of 15.0% p.a. and the benchmark +4.8% p.a. The iQ-FOXX Alpha Index palette is intended for investors seeking improved performance. Through the targeted use of leverage, rising markets can be exploited and short positions enable alpha to be achieved even in phases of falling markets. The use of leverage (1.5x or 2x) in positive market periods enables a further increase in yield.

The alpha indices form the top of the iQ-FOXX rule-based indices. The basic variant “smart BETA” is long or cash positive. Alpha can be achieved by Risk-ON (100% index participation) or Risk-OFF (holding cash). The “enhanced BETA” indices use leverage in upward periods in comparison to “smart BETA”.

More security through iQ-FOXX Forecast-based indices

The use of iQ-FOXX indices can reduce the extent of drawdowns by up to two thirds. For example, the maximum drawdown of the world stock index has been reduced by two thirds from -54% to -19%. iQ-FOXX indices can be used in a variety of ways and are used for the management of absolute return products, tailor-made funds, discretionary asset management mandates, risk overlays for existing customer portfolios, asset allocation management and multi-asset products. The proprietary iQ-FOXX smart BETA Index range covers all major asset classes such as equities, bonds, commodities, real estate and currencies.

No advice: This information is for informational and illustrative purposes only and does not constitute an individual investment recommendation or an offer to buy or sell securities or other financial instruments. This report does not replace individual investor and investment advice. The information has been carefully compiled. However, no guarantee can be given for the accuracy and completeness of the information.