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M&A ETF (MNA) Hits New 52-Week High

For investors seeking momentum, IQ Merger Arbitrage ETF MNA is probably on radar now. The fund just hit a 52-week high, and is up 6.3% from its 52-week low price of $30.25/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

MNA in Focus    

This fund offers capital appreciation by investing in global companies for which there has been a public announcement of a takeover by an acquirer while at the same time providing short exposure to global equities as a partial equity market hedge. This is done by tracking the IQ Merger Arbitrage Index. The product charges 75 bps in annual fees from investors (see: all the Hedge Fund ETFs here).

Why the Move?

The M&A space has been an area to watch lately given the announcement of the biggest ever acquisition deal in the gold sector. Newmont Mining Corp NEM has planned to acquire smaller rival Goldcorp Inc GG for $10 billion or $12.5 billion, including debt. Under the terms of the deal, Newmont has offered 0.3280 of its share and couple of cents for each Goldcorp share. The combination will create the world’s largest gold producer in the United States.
 
More Gains Ahead?

It seems that MNA might remain strong given a positive weighted alpha of 2.60% and a low 20-day volatility of 5.38%. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.

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