According to a press release the Credit Suisse Long/Short Liquid Index (Net) ETN (ticker: CSLS) is designed to correlate to the historical performance of the Credit Suisse Tremont Long/Short Equity Hedge Fund Index by tracking the performance of non-hedge fund, transparent market measures. The firm says that the exchange traded approach offers a variety of advantages to investors, including real-time pricing, intraday liquidity and portfolio transparency – advantages that, according to a press release, were previously not associated with alternative investments.
However, the firm notes that the Credit Suisse Long/Short Liquid Index (Net) ETN does not invest directly in hedge funds and therefore does not have the risks usually associated with hedge funds such as illiquidity, fraud risk or individual manager risk.
This new ETN seeks to replicate the performance of the Long/Short Equity hedge fund sector as represented by the Credit Suisse Long/Short Liquid Index (Net), an index which is calculated intraday and “reflects the return of a dynamic basket of 18 liquid, investable market factors”. Those factors are selected and weighted monthly in accordance with an algorithm that aims to track the performance of the Credit Suisse/Tremont Long/Short Equity Hedge Fund Index.
The ETN’s investment performance depends on the investment performance of the underlying Credit Suisse Long/Short Liquid Index (Net). There is no guarantee that the ETN or the Credit Suisse Long/Short Liquid Index (Net) will perform the same as the referenced Credit Suisse/Tremont Long/Short Index, and the ETN may not suitable for all investors.
More information on the Credit Suisse Long/Short Liquid Index (Net) ETN can be found on: http://www.credit-suisse.com/notes.