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IQ Insight

www.IndexIQ.com Salvatore J. Bruno, Chief Investment Officer Performance Snapshot
As of April 30, 2013 As of March 31, 2013
Since Index Inception* 1 Year 2.69% 2.43% 4.61% Since Fund Inception* 2.88% 2.56% 5.35% Since Index Inception* Inception Date 6/30/2008 Since Fund Inception* 3.18% 2.84% 5.62%

May 2013

Mutual Fund:
IQ Alpha Hedge Strategy Fund

Ticker
IQHIX NAV IQHOX NAV Index - IQHGALPH

1 Month 1.64% 1.54% 1.70%

3 Month 2.53% 2.43% 2.90%

YTD 2.63% 2.53% 3.16%

1 Year 4.88% 4.42% 6.66%

4.09%

3.84%

10/31/2007

ETFs:
IQ Hedge Multi-Strategy Tracker ETF

Ticker
QAI Share Price NAV Index- IQHGMST MCRO Share Price NAV Index- IQHGMAT QMN Share Price NAV Index- IQHGMN MNA Share Price NAV Index - IQMNAT CPI Share Price NAV Index - IQHGCPIT GRES Share Price NAV Index - IQGREST CROP Share Price NAV Index - IQSMCROT IOIL Share Price NAV Index - IQSMOILT ROOF Share Price NAV Index - IQSMREST CNDA Share Price NAV Index - IQSMCANT KROO Share Price NAV Index - IQSMAUST

1 Month 0.96% 1.18% 1.22% 0.64% 0.49% 0.60% 1.30% 1.30% 1.34% -0.70% -0.35% -0.35% 0.19% 0.23% 0.27% -5.47% -4.49% -4.60% -0.57% -0.49% -0.42% 0.31% 0.73% 0.84% 2.89% 3.05% 3.12% -5.95% -5.71% -5.71% -5.07% -4.39% -4.41%

3 Month 1.68% 1.86% 2.09% -0.41% -0.37% -0.11% 1.74% 1.70% 1.81% 1.31% 1.95% 2.14% 0.53% 0.45% 0.59% -6.35% -5.38% -5.51% 0.92% 1.34% 1.60% 4.26% 4.71% 5.12% 12.10% 12.10% 12.39% -9.83% -9.67% -9.45% -5.07% -3.96% -3.86%

YTD 2.27% 1.97% 2.27% -1.75% -1.61% -1.28% 2.55% 1.98% 2.20% 1.11% 2.98% 3.37% 0.65% 0.61% 0.76% -6.90% -4.49% -4.53% 3.05% 3.73% 4.07% 14.09% 13.28% 13.91% 21.68% 21.56% 22.04% -8.51% -8.34% -8.05% -1.85% 0.33% 0.48%

1 Year 4.00% 3.85% 4.74% 0.50% 0.36% 1.31% 4.90% -1.62% -1.42% 0.09% 0.90% 1.09% 1.56% -0.87% -0.35% 0.69% 8.44% 7.91% 8.90% 11.06% 12.09% 13.41% 39.64% 39.85% 41.18% -15.56% -15.49% -14.51% -7.15% -6.51% -5.82%

Since Fund Inception* 4.41% 4.39% 5.06% 3.03% 3.02% 3.67% 3.22% 3.10% 3.50% 0.95% 1.13% 2.33% 1.74% 1.75% 2.31% 4.88% 5.07% 6.14% 2.90% 3.00% 3.34% 0.14% 0.78% 1.79% 22.08% 23.29% 24.38% -3.23% -3.04% -2.18% -0.25% -0.03% 0.75%

Since Index Inception*

1 Year 2.72% 2.46% 3.32% -0.24% -0.13% 0.78% 3.54% 0.00% 0.16% 2.13% 1.05% 1.13% 1.60% 4.22% 3.91% 5.14% 5.72% 5.88% 6.80% 6.98% 8.81% 10.00% 38.22% 38.29% 39.57% -11.78% -11.62% -10.64% -2.78% -2.64% -1.85%

Since Fund Inception* 4.25% 4.18% 4.85% 2.93% 2.95% 3.59% 1.90% 1.78% 2.13% 1.19% 1.26% 2.49% 1.73% 1.73% 2.29% 6.74% 6.62% 7.76% 3.31% 3.37% 3.69% -0.02% 0.43% 1.42% 21.26% 22.42% 23.50% -1.34% -1.22% -0.32% 1.47% 1.46% 2.28%

Since Index Inception*

Inception Date 3/25/2009

3.27%

3.06%

IQ Hedge Macro Tracker ETF

9/15/2008 6/9/2009

4.15%

4.09%

IQ Hedge Market Neutral Tracker ETF

9/15/2008 10/4/2012

4.64%

4.41%

IQ Merger Arbitrage ETF

9/15/2008 11/17/2009

0.76%

0.84%

IQ Real Return ETF

10/31/2007 10/27/2009

1.49%

1.46%

IQ Global Resources ETF

12/31/2008 10/27/2009

1.60%

2.51%

IQ Global Agribusiness Small Cap ETF

10/31/2007 3/22/2011

10.20%

10.63%

IQ Global Oil Small Cap ETF

2/8/2010 5/5/2011

-1.37%

-1.84%

IQ US Real Estate Small Cap ETF

4/11/2011 6/14/2011

21.41%

20.42%

IQ Canada Small Cap ETF

6/6/2011 3/23/2010

2.22%

4.21%

IQ Australia Small Cap ETF

2/8/2010 3/23/2010

5.23%

6.89%

2/8/2010

*Performance greater than 1 year is annualized. There are risks associated with investing including possible loss of principal. The performance data quoted above represents past performance, which is not a guarantee of future results. Investment return and value o f the Funds’ shares will fluctuate so that an investor’s shares, when sold, may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. Fund returns reflect dividends and capital gains distributions. Fund performance current to the most recent month-end is available by calling 1-888-934-0777 or by visiting www.indexiq.com.

Table of Contents
Section I. II. III. Executive Summary Key Economic Data and Market Developments Asset Class Performance o IV. Table 1: Asset Class Performance Page 3 3 3 4 4 4 4 5 5 6 6 7 8 9 9 10 10 11 11 11 12 12 13 13 13 14 14 15 15 15 16 16 17 17 17 18 18 19 20

IQ Absolute Return indices o o o o o o o o o o o o o o o o o Table 2: IndexIQ Absolute Return indices Performance Chart 1: IndexIQ Absolute Return indices Cumulative Performance Chart 2: IQ Alpha Hedge Index Monthly Strategy Allocations Table 3: IQ Alpha Hedge Index Asset Allocation Chart 3: IQ Alpha Hedge Index Performance Chart 4: IQ Hedge Multi-Strategy Index Monthly Strategy Allocations Table 4: IQ Hedge Multi Strategy Index Asset Allocation Chart 5: IQ Hedge Multi Strategy Index Performance Table 5: IQ Hedge Macro Index Asset Allocation Chart 6: IQ Hedge Macro Index Performance Table 6: IQ Hedge Market Neutral Index Asset Allocation Chart 7: IQ Hedge Market Neutral Index Performance Table 7a: Additions to the IQ Merger Arbitrage Index Table 7b: Deletions from the IQ Merger Arbitrage Index Chart 8: IQ Merger Arbitrage Index Performance Chart 9: IQ Real Return Index Asset Allocation Chart 10: IQ Real Return Index Performance

V.

IQ Real Asset indices o o o o o o o o o Table 8: IndexIQ Real Asset indices Performance Chart 11: IndexIQ Real Asset indices Cumulative Performances Chart 12: IQ Global Resources Index Monthly Allocation Chart 13: IQ Global Resources Index Performance Table 9: Sector Weights, Returns, and Contributions: IQ Agribusiness Small Cap Index Table 10: Sector Weights, Returns, and Contributions : IQ Global Oil Small Cap Index Table 11: Sector Weights, Returns, and Contributions : IQ U.S. Real Estate Small Cap Index Chart 14: Valuation Chart: Real Asset indices Chart 15: Performance: Real Asset indices

VI.

IQ International indices o o o o o Table 12: IndexIQ International indices Performance Chart 16: Index IQ International indices Cumulative Performance Table 13: IQ Australia Small Cap Index & IQ Canada Small Cap Index Chart 17: Valuation Chart: International indices Chart 18: Performance: International indices

About IndexIQ

Page 2

6% to 4.S.S.S.87%).50% while the CPI-Ex Food and Energy rose by 1.5%.S.000 in February after adding a revised 268.000.04MM. The big bright spot was housing as the housing starts topped 1MM and there was a continued resurgence in home prices. Treasury Bond dropped back to 1.S. were negative as gold prices suffered their worst drop in over 30 years. Consumer Price Index for All Urban Consumers seasonally adjusted (CPI-U SA) fell by -0. U. For the 12 months ending March 2013. Oil futures (Bloomberg: CL1 <Commodities>) fell by -3. Event Driven strategies including Merger Arbitrage and Distressed Securities were up nearly 1% each. The unemployment rate dropped to 7.2% in March. The U.  Real Estate internationally was up (RWX: 7.02%) were up.3% in the second quarter and 2. The U.  The performance of the major asset class ETFs1 is detailed in Table 1.     III. Hedge funds posted mostly positive returns as the broad index was up for the month.92% with small caps (IWM) falling by -0.I. II. Department of Commerce announced that housing starts were at a seasonally adjusted annual rate (SAAR) of 1. up 7. Copper. large cap equities (SPY) were up by 1. Shorter duration bonds (SHV: 0.  Commodities (DJP: -2.  The Euro gained ground vs.71%) but the Yen lost ground (FXY: -3. 3. International markets moved higher as did emerging markets.27%.45%).  Asset Class Performance: 1 U. Developed international markets were up (EFA: 5.5% annual rate in the first quarter of 2013 from the fourth quarter of 2012. Core inflation (CPI-Ex Food and Energy) was up a modest 0. High yield bonds (HYG: 2.  Broad based bonds (BND: 1. 1 ETFs are used as proxies for the applicable asset classes.88% but natural gas futures (Bloomberg: NG1 <Commodities>) were up by 7. Commodities. They got caught up in a mid-month global asset sell off that was triggered by reports of Cypress liquidating gold holdings as well as China first quarter GDP coming in below expectations. The absolute return strategies. This decrease was largely driven by moderating gasoline prices.3% for the 12 months ending February.50% and Aluminum futures (Bloomberg: LMAHDY <Commodities>) fell by -2. Census Bureau issued a joint release that sales of new single-family houses were at a seasonally adjusted annual rate (SAAR) of 417. 1. the U. Dollar (FXE: 2. First quarter GDP was positive at 2. Headline inflation dropped as the U.S.52%.000.9.1% in the third quarter. Equity markets continued to power ahead although it was far from a smooth ride.S. our gratitude goes out to the first responders and law enforcement personnel that performed so admirably.9%. broadly.02%) as were emerging markets (VWO: 2. Existing home sales were down -0.9% to a SAAR of 902.29%. The Case-Schiller Index is up 9. silver and oil were also off but natural gas was the lone bright spot continuing its strong price recovery.2% in February and was up 9.   Key Economic Data and Market Developments: The U.000 jobs in February. Within precious metals. Industrial metals futures were down as Copper futures (Bloomberg: LMCAHDY <Commodities>) lost -6. government bonds (IEF) gained 1.35%. the U.6%. Also.2% in February. Macro economic data was a bit disappointing as job creation slowed in March.0%.3% for the 12 months ending February. the CPI-U NSA was up by 1.0% in the first quarter. 2013.1 from a revised 61.68% on economic growth concerns. The Case-Schiller Home Price Index rose by 1. BLS) announced that non-farm jobs increased by 88.78%).1% after rising by 0.50% for the month. up 1.000 jobs in February.0%. The Conference Board Consumer Confidence Index TM rose to 68. Bureau of Labor Statistics (U.02%) were flat. All of the strategies had positive returns. broadly. were positive as were the directional strategies. The yield curve flattened as the yield on the 10 year U. Building permits were down -3.S. The remaining strategies all returned near 0.S.S.93% and silver (Bloomberg: SILV <Commodities>) fell by -15. 2013.02%).5% but was below the consensus estimate of 3.83%) broadly were down. Page 3 . gold (Bloomberg: GOLDS <Commodities>) fell by -7. aluminum.12%) were up as were investment grade corporate bonds (CFT: 1. Headline inflation moderated as energy prices receded and the consumer confidence index recovered from the prior month’s drop. Executive Summary: Our thoughts and prayers go out to those affected by the Boston Marathon tragedy. Private sector payroll employment added 95.S. Convertible Arbitrage led the way rising by over 2% for the month. REITS (RWR: 6.21%) as were U.000 jobs following a revised increase of 254. Longer duration U.S. Bureau of Economic Analysis (BEA) announced that the “advanced” estimate of real gross domestic product (GDP) grew by a 2.04%. Department of Housing and Urban Development (HUD) and the U.S. Real GDP grew by 0. Separately.92 million units.4% in the fourth quarter of 2012.

56% Barclays US Aggregate 1.83% -1.60% 0.69% -1.68% HFRX Global Index 0.92% 7.09% IQ Real Return Index 0. Table 2: IndexIQ Absolute Return indices Performance IQ Alpha Hedge Index 1.70% 2.68% 1.90% IQ Merger Arbitrage Index -0.78% 3.0% 03 /28 /20 13 04 /1/ 20 13 04 /2/ 20 13 04 /3/ 20 13 04 /4/ 20 13 04 /5/ 20 13 04 /8/ 20 13 04 /9/ 20 13 04 /10 /20 13 04 /11 /20 13 04 /12 /20 13 04 /15 /20 13 04 /16 /20 13 04 /17 /20 13 04 /18 /20 13 04 /19 /20 13 04 /22 /20 13 04 /23 /20 13 04 /24 /20 13 04 /25 /20 13 04 /26 /20 13 04 /29 /20 13 04 /30 /20 13 IQ Alpha Hedge Index IQ Hedge Market Neutral Index S&P 500 IQ Hedge Multi-Strategy Index IQ Merger Arbitrage Index Barclays US Aggregate IQ Hedge Macro Index IQ Real Return Index HFRX Global Index Data as of April 30.25% 0.02% 8.35% 2.31% 4.14% 3. Past performance is not a guarantee of future results.56%.64% -4.06% 4.79% 1.89%.09% 2.29% SPDR Dow Jones REIT ETF 6.76% 1.April 2013 3.27% 4. Bloomberg.59% 0.0% -2. 2013.  Strategy allocations are contained in Chart 2.31% -0.86% 3. Page 4 .89% Past performance is not a guarantee of future results. and the IQ Hedge Event-Driven Beta Index each remained at their maximum long weights of 33.20% 12.63% 16.78% to 30. the IQ Hedge Long/Short Equity Beta Index.37% 0.20% 4.34% 1.97% -6.22% 2.02% 1.11% 2.32% -0.02% 2.59% 11.67%.  The short allocation to the IQ Hedge Global Macro Beta Index was reduced by 2.20% 17. IQ Absolute Return indices The performance of the IndexIQ Absolute Return indices is detailed in Table 2.70% iShares MSCI EAFE Index Fund 5.01% 1.0% 0.66% IQ Hedge MultiStrategy Index 1.74% 16.78% to -13.70% -6.54% 7.27% 0.02% Through 4/30/2013 1 Month 3 Months YTD Last 12 Months S&P 500 1.  The IQ Hedge Market Neutral Beta Index allocation was reduced by 2.89% 3.01% 1.70% 3.81% 2. IndexIQ research. IQ Alpha Hedge Index (IQHGALPH) Allocation  The IQ Hedge Emerging Markets Beta Index allocation remained at its maximum short position of -16.19% 12.79% Past performance is not a guarantee of future results.92% 0.20% -1. Chart 1: IndexIQ Absolute Return indices Cumulative Performance Cumulative Performance .0% -1.12% 0.02% 5.66% 5. The cumulative index performance for the prior month for the IndexIQ Absolute Return indices is displayed in Chart 1.28% 2.77% 2.60% 1.60% 1.64% 2.14% 12.93% 19.87% 2.52% -2. IV.33%.90% 4.93% 7.72% IQ Hedge Market Neutral Index 1.35% 1.16% 6.0% Cumlative Return 1.02% 1.0% 2.55% 5.74% IQ Hedge Macro IQ Hedge Index SMA Index 0.78% 10.Table 1: Asset Class Performance Through 4/30/2013 1 Month 3 Months YTD Last 12 Months SPDR S&P 500 ETF 1.94% 1.27% Vanguard iShares iBoxx iShares iShares Barclays iPath FTSE iShares Russell Vanguard Total iShares $ High Yield Barclays Short Barclays 7-10 DJ UBS Emerging 2000 Index Bond Market Barclays Credit Corporate Treasury Bond Year Treasury Commodity TR Markets ETF Fund ETF Bond Fund Bond Fund Fund Bond Fund ETN 2.02% -0.  The IQ Hedge Fixed Income Arbitrage Beta Index.90% 3.42% 14. Source: Factset.97% 0.34% 1.05% PowerShares DB US Dollar Bullish Fund -1.33% 17.62% 1.77% 4.

03% 0.47% 5.00% 4. Table 3: IQ Alpha Hedge Index Asset Allocation Asset Class Group Bonds Investment Grade Corporate Bond High Yield Corporate Bond Convertible Bonds Floating Rate U.35% 5.43% 0.04% 13.36% 45.00% Change -2.87% 0.24% -2.78% 3.27% -0.07% 1.52% -0.59% 0.03% 1.40% -0.04% -2.08% -0.00% -3.89% 0.89% 11.28% 0.23% 2.38% 7.00% May-13 94.36% -0.00% -6.06% 0.12% 0.46% 17.85% 0.13% 0.92% 0.72% 39.71% 0.60% 14.97% 1.14% 2.77% 125.64% 17.16% -0.60% 1.70% 3.21% 0.S.32% -3.00% -1.00% -1. Large Cap Equity International Equity International Small Cap Equity Emerging Equity Emerging Small Cap Equity Real Estate U.39% -4.84% 125.50% 2.38% 0.48% -7.00% -7. Short Term Treasury Bond Aggregate Bond International Bond Treasury Inflation Protected Securities Commodities Broad Gold Silver Currencies Canadian Dollar Euro Emerging Markets Japanese Yen Currency Strategy Equity U.67% -0.S.26% 4. Page 5 .02% 8.00% Performance  The weights and contribution to the prior month’s performance by asset type is in Chart 3.00% 3.15% 0.29% 2.00% -4.S.44% -8.01% 0.37% 16.98% -1.IQ Hedge Fixed IQ Hedge Global Long/Short Beta Neutral Beta Driven Beta Index Income Arbitrage Macro Beta Index Index Index Beta Index Allocations for the month of: Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13  The asset allocation is in Table 3.10% 20.12% -4.00% -0.02% 39.88% 0.S.12% 2.02% 14.67% 42.37% -0.08% -0. REITS International REITS Volatility Total Apr-13 96.19% 5.70% 0.23% 0.09% -4.75% 7.05% 0.05% 0.80% -6.68% -0.76% -1.08% -0.Chart 2: IQ Alpha Hedge Index Monthly Strategy Allocations % Allocation to the IQ Beta Indices 40% 30% 20% 10% 0% -10% -20% IQ Hedge Emerging Markets Beta Index IQ Hedge IQ Hedge Market IQ Hedge Event.46% 11.88% 1.38% 0. Small Cap Equity U.71% -1.66% 11.71% 0.

Canadian Dollar IQ Hedge Fixed IQ Hedge Income Global Macro Arbitrage Beta Beta Index Index Apr-13 May-13  Page 6 U.  The IQ Hedge Market Neutral Beta Index allocation was reduced by 2. Small Cap Equity International Equity U.S.33%. and the IQ Hedge Event-Driven Beta Index each remained at their maximum long weights of 33. Chart 4: IQ Hedge Multi-Strategy Index Monthly Strategy Allocations 40% % Allocation to the IQ Beta Indices 30% 20% 10% 0% -10% -20% IQ Hedge IQ Hedge IQ Hedge IQ Hedge Emerging Long/Short Beta Market Neutral Event-Driven Markets Beta Index Beta Index Beta Index Index Allocations for the month of: Dec-12 Jan-13 Feb-13 Mar-13 The asset allocation is in Table 4.78% to 30.56%. Large Cap Equity International Bond Broad Commodity Investment Grade Corporate Bond Emerging Equity Aggregate Bond Medium Term Volatility G10 Currency Harvest Convertible Bonds Floating Rate U. the IQ Hedge Long/Short Equity Beta Index.89%.S.00% Contribution to Total Return 50% 40% 30% 20% 10% 0% -10% 3.  The short allocation to the IQ Hedge Global Macro Beta Index was reduced by 2.  The IQ Hedge Fixed Income Arbitrage Beta Index.78% to -13.00% 4.00% 2.S.00% 0. Short Term Treasury Bond High Yield Corporate Bond Contribution to Total Return (LHS) Treasury Inflation Protected Securities Avg Weight (RHS) IQ Hedge Multi-Strategy Index (IQHGMS) Allocation  The IQ Hedge Emerging Markets Beta Index allocation remained at its maximum short position of -16.S.Chart 3: IQ Alpha Hedge Index Performance 5.  Strategy allocations are contained in Chart 4.00% International REITS Emerging Markets U.00% 1.00% -1.67%. REITS Silver Gold Total Euro Yen Avg Weight .

Large Cap Equity (Short) International Equity (Short) Emerging Equity (Short) Real Estate U.73% 0.22% 0.51% 0.S.00% 0.82% 0.00% 0.00% 1.00% 0.28% 8.85% 0.00% 0.30% 7.61% 1.S.28% 0.00% 2.73% 7.00% 2.00% -0.70% 0.05% 0.06% 0.14% 25.00% 0.17% 0.00% 1.00% 0.67% -5.41% 1.62% 13.00% 0.02% -0.00% 1.52% 100.28% 2.05% 0.00% -0.00% 0. Small Cap Equity (Short) U.53% 0.S.00% 0.00% 0.00% 0.75% 0.00% 0.00% 0.00% 0.82% 0.03% 0.47% 0. REITS International REITS Real Estate (Short) U.60% 9.72% 1.00% 0.11% 0.S.00% 0.31% 0.20% 1.42% 9.S.79% 4.00% 0.56% 11.00% Page 7 .S.00% May-13 60.28% 0.10% 3.00% 0.29% 0.75% 0.39% 0.00% 0.73% -0.47% 0.23% 0.00% 0.23% 0.92% 1.44% 0.76% 1.01% 1.93% 0.22% 0.29% -0. Small Cap Equity U. Short Term Treasury Bond Aggregate Bond International Bond Treasury Inflation Protected Securities Commodities Broad Gold Silver Commodities (Short) Broad (Short) Gold (Short) Silver (Short) Currencies Canadian Dollar Euro Emerging Markets Japanese Yen Currencies (Short) Euro (Short) Japanese Yen (Short) Currency Strategy Equity U.29% 0.53% 0.25% 2. Large Cap Equity International Equity International Small Cap Equity Emerging Equity Emerging Small Cap Equity Equity (Short) U.29% 0.Table 4: IQ Hedge Multi Strategy Index Asset Allocation Asset Class Group Bonds Investment Grade Corporate Bond High Yield Corporate Bond Convertible Bonds Floating Rate U.00% 0.00% 0.00% 0.00% 0.64% 3.05% 2.00% 0.00% 1.17% 2.00% 0. REITs (Short) Volatility Volatility (Short) Total Apr-13 63.00% 0.55% 1.72% 0.92% 0.36% 1.00% 0.00% 0.02% 0.00% 0.75% 11.23% 7.39% 3.13% 0.89% 5.24% -0.84% 1.00% -0.00% 0.06% 4.03% 1.43% 26.49% 100.04% 29.00% 2.29% 0.84% 28.00% Change -2.05% 0.11% 0.00% 0.00% -0.00% 0.53% -3.03% 0.00% 0.88% 10.08% 0.78% 2.00% -0.81% -0.S.70% 0.00% 0.00% 1.77% -0.

50% 0.  The asset allocation is in Table 5.00% 0.50% 30% 25% 20% Contribution to Total Return 2.00% 2.50% 1.S.S. the maximum allocation allowed by index rules. the IQ Hedge Emerging Markets Beta Index allocation remained at 75%.S. Large Cap Equity Investment Grade Corporate Bond Emerging Markets High Yield Corporate Bond G10 Currency Harvest Floating Rate Gold (Short) Yen (Short) Euro (Short) Real Estate (Short) U.Performance  The weights and contribution to the prior month’s performance by asset type is in Chart 5. Short Term Treasury Bond Silver Medium Term Vol (Short) U.50% Contribution to Total Return (LHS) Avg Weight (RHS) IQ Hedge Macro Index (IQHGMA) Allocation  The allocation to the IQ Hedge Global Macro Beta Index remained at 25%. Small Cap Equity Total 10% 5% 0% -5% -0.00% 1. Chart 5: IQ Hedge Multi Strategy Index Performance 3. Page 8 Treasury Inflation Protected Securities Avg Weight 15% . the minimum allocation allowed by index rules. Conversely.00% International Equity Emerging Equity Aggregate Bond International REITS International Bond Convertible Bonds Broad Commodity U.

Chart 6: IQ Hedge Macro Index Performance 4.52% 0.00% 5.00% 0.S.00% 0.00% 0.28% 0.34% 2. Small Cap Equity (Short) U.00% 0.00% 0.00% 0.69% 2.00% 0.05% 7.00% 0.00% 1.73% 14. Small Cap Equity U.00% 0.00% 30% Contribution to Total Return 1.46% 0. Short Term Treasury Bond Aggregate Bond International Bond Treasury Inflation Protected Securities Commodities Broad Gold Silver Commodities (Short) Broad (Short) Gold (Short) Silver (Short) Currencies Canadian Dollar Euro Emerging Markets Japanese Yen Currencies (Short) Euro (Short) Japanese Yen (Short) Currency Strategy Equity U.52% 0.00% 0.93% 0.00% 0.00% 0.S.00% 0.00% 0% -1.21% 0.00% 0.16% -0.00% 0.00% 16.01% 1.90% 0.00% 0. Small Cap Equity Total Gold -10% Contribution to Total Return (LHS) Avg Weight (RHS) Page 9 Avg Weight 2.81% 17.00% 0.00% 100.00% 0.06% 0.01% 0.57% 0.00% 6.00% 36.28% 0.10% 0.00% 5.28% 0.00% 0.96% 6.19% 0.13% -1.00% 0.00% Performance  The weights and contribution to the prior month’s p erformance by asset type is in Chart 6.00% 0.00% 0.78% 0.00% 0.00% 0.00% 0.S.27% 0.11% 0.00% 0.00% 0.91% 2.19% 0.11% 6.00% 0.00% 0.20% 0.00% 0.00% 3.00% 0.S.00% 2.00% 1.00% 0.05% 0.00% 14.00% 0.00% 0.69% 6.S.00% 2.90% 0.00% 0.00% 0.00% 0.00% 4.00% -0.00% 0.00% 40% 3.61% 0.28% 0.00% 0.00% Change -0.00% 100.40% 0.86% 16.17% 0.00% -1.00% 20% .00% 0.00% 0.00% 0.00% 0.75% 0. Large Cap Equity International Equity International Small Cap Equity Emerging Equity Emerging Small Cap Equity Equity (Short) U.00% 10% 0.83% -0.35% -0. Short Term Treasury Bond Canadian Dollar Medium Term Volatility Euro Yen U. Large Cap Equity (Short) International Equity (Short) Emerging Equity (Short) Real Estate U.00% 0.S.00% 2.Table 5: IQ Hedge Macro Index Asset Allocation Asset Class Bonds Group Investment Grade Corporate Bond High Yield Corporate Bond Convertible Bonds Floating Rate U.13% 0.74% -0.00% 0.00% 0.00% 0.54% 0.28% 0.00% 0.00% -0.20% 0.00% 0.00% 0.90% 0.00% 0. REITS International REITS Real Estate (Short) U.00% International Bond Emerging Small Cap Equity Broad Commodity Investment Grade Corporate Bond Emerging Equity G10 Currency Harvest Silver (Short) U.06% 6.26% 0.S.00% 3.00% May-13 66.72% 0. REITs (Short) Volatility Volatility (Short) Total Apr-13 66.08% 2.00% 1.S.00% -0.00% 35.00% 0.52% 0.00% 0.27% 0.35% 0.20% 0.00% -1.S.00% 0.38% 0.07% 16.95% 7.

Small Cap Equity (Short) U.00% 0. Large Cap Equity International Equity International Small Cap Equity Emerging Equity Emerging Small Cap Equity Equity (Short) U.00% 45.00% 100.00% 9.11% 1.98% 0.71% 19.S.21% 0.97% 0.89% -0.00% 0.00% 0.00% 0.S. Short Term Treasury Bond U. Chart 7: IQ Hedge Market Neutral Index Performance 5.85% 0.90% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.15% 37.S.89% 0.S.00% 0. Small Cap Equity (Short) U.00% 0.00% 0.00% 50% 40% 30% 20% 10% 0% -10% International Equity Convertible Bonds Treasury Inflation Protected Securities Emerging Equity (Short) Aggregate Bond High Yield Corporate Bond G10 Currency Harvest U.00% 0.00% -0.13% 0.22% 0.00% 0.58% 0.00% 0.52% 0.81% 0.00% 0.25% 1.70% 78.00% 0.00% 0.00% -0.00% 0.13% 0.00% 0.00% 0.S.00% 0.46% 19.00% Contribution to Total Return (LHS) Avg Weight (RHS) Page 10 Avg Weight .00% 0.48% -0.00% 0.00% 0.00% 0.00% 4.00% 2.00% 0.74% -0.00% 0.12% 0.00% 0.00% 0.00% -0.00% 0.00% Performance  The weights and contribution to the prior month’s performance by asset type is in Chart 7.98% 0.09% -1.67% 0.34% 0.00% 0.00% 9.00% 0.00% 0.00% 0.S.00% 0.00% 0.00% 0.34% 0.S.S.11% 1.00% 0. REITs (Short) Volatility Volatility (Short) Total Apr-13 May-13 76.00% 0.12% 0.00% 0.00% 0.00% 0.00% 0.18% 20. REITS International REITS Real Estate (Short) U.00% 100.00% 0.00% 0.00% Change 1.00% 0.00% 0.00% 0. Conversely.00% -1. Small Cap Equity Euro (Short) Total Contribution to Total Return 3.38% 0.00% 0.21% 0.00% 0.00% 2.28% 0.00% 0.00% -7.00% 0.00% 0.00% 0. Small Cap Equity U.25% 15.13% 5.IQ Hedge Market Neutral Index (IQHGMN) Allocation  The allocation to the IQ Hedge Market Neutral Beta Index remained at 75%.00% 0.00% 0.00% 0.71% 14.00% 0. the IQ Hedge Fixed Income Arbitrage Beta Index allocation remained at 25%.00% 6.00% 0.S.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.00% 0.  The asset allocation is in Table 6.00% 19.S.00% 0.00% -0.00% 0.00% 0.00% 0.00% 0. Table 6: IQ Hedge Market Neutral Index Asset Allocation Asset Class Bonds Group Investment Grade Corporate Bond High Yield Corporate Bond Convertible Bonds Floating Rate U.00% 0.00% 1.81% 18.99% 0.27% 0.00% 0.00% 0.14% 0.00% 0.00% 0. Short Term Treasury Bond Aggregate Bond International Bond Treasury Inflation Protected Securities Commodities Broad Gold Silver Commodities (Short) Broad (Short) Gold (Short) Silver (Short) Currencies Canadian Dollar Euro Emerging Markets Japanese Yen Currencies (Short) Euro (Short) Japanese Yen (Short) Currency Strategy Equity U.00% 0.00% 0. Large Cap Equity (Short) International Equity (Short) Emerging Equity (Short) Real Estate U.00% 0.00% 0.14% 0.

In technology.50% -1. Benckiser GmbH Consumer Staples Royalty Pharma. Alterra Capital Holdings Ltd. Ltd. Softchoice Corp. GrainCorp added 35 bps. Health Care Markel Corp. Inc. down from 25.E MASTER BLENDERS 1753 N.75% last month. Dell detracted 48 bps.  The equity hedge was negative in terms of performance impact.L. Energy Tomizawa KK (Shizuoka) Consumer Cyclicals Brookfield Office Properties. /Private Group/ Financials Ontario Teachers' Pension Plan Board Financials Valeant Pharmaceuticals International. National Financial Partners Corp. Consumer Staples Salini Costruttori SpA Capital Goods Priceline. In the energy sector. Cl A Cymer Inc. Lufkin Industries Inc.  The weighted average premium embedded in the index is 0.93%. Inc.IQ Merger Arbitrage Index (IQMNA) Allocation  The hedge ratio based on the mix of stock and cash in the deals and the weight of the stocks in the index is 20. The 12 companies deleted from the index since the prior month’s rebalance date are listed in Table 7b. D. Cl A SeaCube Container Leasing Ltd.50% 0. Acquirer Target Name Sector Koch Industries.00% 0. Plains Exploration detracted 41bps. Inc. Last month the premium was 1.00% -0.J. Technology Inc. Copano Energy L. Technology Country Canada United States United States United States Bermuda United States United States United States United States United States Italy United States Announce Date 12/05/2012 12/30/2012 01/18/2013 03/20/2013 12/19/2012 01/29/2013 09/26/2012 10/17/2012 01/07/2013 02/14/2013 02/06/2013 11/08/2012 Added Date 02/05/2013 02/05/2013 02/05/2013 04/03/2013 01/04/2013 02/05/2013 10/03/2012 12/05/2012 02/05/2013 03/05/2013 03/05/2013 01/04/2013 Deal Result Completed Completed Completed Completed Completed Completed Max Age Max Age Scenario Completed Completed Min Wt Performance Discussion  Performance was mixed across the sectors. Inc. Inc. Obagi Medical Products Inc. Chart 8: IQ Merger Arbitrage Index Performance 2.50%. Capital Goods Berkshire Hathaway. Cl A Acquirer Name Sector Primaris Retail Real Estate Investment Trust Financials /Private Group/ Duff & Phelps Corp. In the communications sector. Target Country United States United States Netherlands Ireland United States United States Japan United States United States United States Canada Announce Date 04/24/2013 04/29/2013 03/28/2013 02/25/2013 04/15/2013 04/08/2013 04/15/2013 04/25/2013 04/15/2013 04/22/2013 04/22/2013 Added Date 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 05/03/2013 Table 7b: Deletions from the IQ Merger Arbitrage Index Target Name Primaris Retail Real Estate Investment Trust Duff & Phelps Corp. Megane Top Co. Elan Corporation PLC Life Technologies Corp. /Private Group/ Consumer Staples ASML Holding NV Technology ABB Ltd. Basic Materials Bayer AG Health Care Joh. American Greetings Corp. Page 11 Avg Weight . Health Care General Electric Co.C. A. Financials Madison Dearborn Partners LLC Financials ABB Ltd. Heinz Co.00% 1. Inc. Power-One Inc. In consumer staples.  The 11 companies added to the index in the latest rebalance are listed in Table 7a. Capital Goods Birch Hill Equity Partners Management. EnergySolutions Inc. Conceptus Inc.86%. H.  The weights and contribution to the prior month’s performance by sector is in Chart 8. Table 7a: Additions to the IQ Merger Arbitrage Index Target Name Buckeye Technologies Inc. MPG Office Trust Inc. Sprint added 64bps while Clearwire added 10 bps.com. Health Care Thermo Fisher Scientific. Impregilo Spab Kayak Software Corp. Financials Kinder Morgan Energy Partners LP Utilities American Greetings Corp. Inc.V.00% Contribution to Total Return (LHS) Avg Weight (RHS) Note: Miscellaneous includes the equity hedge as well as any cash and cash equivalents.50% Contribution to Total Return 20% 15% 10% 5% 0% -5% -10% Energy Consumer Cyclicals Transportation Consumer Staples Communication Services Capital Goods Health Care Technology Financials Utilities Total Miscellaneous 1.

00% 0.00% -1. Chart 9: IQ Real Return Index Asset Allocation 80% 70% 60% 50% 40% 30% 20% 10% 0% Equity Short Term Med Term Long Term Currency Real Estate Bonds Bonds Bonds Dec-12 Allocations for the month of: Jan-13 Feb-13 Gold Oil Nov-12 Mar-13 Apr-13 Performance Discussion  The weights and contribution to the prior month’s performance by asset type is in Chart 10.  The asset allocation is in Chart 9. Chart 10: IQ Real Return Index Performance 7.5%.  The allocation to short term bonds stayed at 60%.5%.00% 6.00% Contribution to Total Return (LHS) Avg Weight (RHS) Page 12 Avg Weight .00% 5.00% 1.  The total equity position also was unchanged at 10%.00% 70% 60% 50% 40% 30% 20% 10% 0% -10% Equity LT Bond MT Bond Real Estate ST Bond Total Gold Contribution to Total Return 4.  The gold position and real estate positions remained at their maximum allowed weights of 10% each. its lowest amount since index inception.IQ Real Return Index (IQHGCPI) Allocation  The index allocation to medium term bonds remained at 7. its maximum allowed by index rules.00% 3.  The allocation to long term bonds also remained at 2.00% 2. The sum of the medium term and long term bond allocations is at the index maximum of 10%.

0% -8. 2 As a percentage of equity. Source: Factset.51% -4.  Water.42% 0.39% 4.2 The allocation to Water decreased based on a less attractive relative Price/Sales ratio. Industrial Metals and Timber are the most overweight sectors.0% Cumulative Performance .0% -10.0% -2. Chart 11: IndexIQ Real Asset indices Cumulative Performance 4. Table 8: IndexIQ Real Asset indices Performance IQ Global Resources Index -4. Food and Fiber.69% IQ Global Agribusiness IQ Global Oil IQ US Real Small Cap Small Cap Estate Small Index Index Cap Index -0. Page 13 .  The sector allocation is in Chart 12.60% 5. IQ Global Resources Index (IQGRES) Allocation  The allocation to the Timber sector was increased for this month based on improved momentum and valuation (Price/Book Value & Price/Sales). Past performance is not a guarantee of future results.12% 1. Each of the other sectors had modest increases in their allocations.0% 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 01 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 8 1 2 3 4 5 8 9 0 1 2 5 6 7 8 9 2 3 4 5 6 9 0 /2 /0 /0 /0 /0 /0 /0 /0 /1 /1 /1 /1 /1 /1 /1 /1 /2 /2 /2 /2 /2 /2 /3 03 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 IQ Global Resources Index IQ Oil Small Cap Index IQ Agribusiness Small Cap Index IQ Real Estate Small Cap Index MSCI World Data as of April 30.41% 41.0% 2.04% 8.90% 13.V.18% Through 4/30/2013 1 Month 3 Months YTD Last 12 Months Past performance is not a guarantee of future results.April 2013 Cumlative Return 0.12% 12. 2013. IndexIQ research. Bloomberg.60% -5. IQ Real Asset Indices The performance of the IndexIQ Real Asset indices is detailed in Table 8. The cumulative index performance for the prior month for the IndexIQ Real Asset indices is displayed in Chart 11.0% -6.53% 0.0% -4. and Livestock are the most underweight sectors.63% 22. Coal.  Precious Metals. Grains.84% 3.07% 13. Energy.

00% -3.  Both the domestic hedge and the international hedges had negative contributions to returns. Industrial Metals were also a large contributor to negative returns.  Water and Energy sector contributed positively to performance.00% Energy Inverse International Inverse Domestic Grains Food Fiber Livestock Industrial Metals Timber Total Precious Metals Water Coal -10% -20% -30% -40% -50% Contribution to Total Return (LHS) Avg Weight (RHS) Page 14 Avg Weight 0% .00% 2.00% -1.00% 0. Chart 13: IQ Global Resources Index Performance 3.  5 out of 8 sectors had negative returns.00% -4.00% -5.00% 30% 20% 10% Contribution to Total Return 1.Chart 12: IQ Global Resources Index Monthly Allocation 25% 20% % Sector Allocation 15% 10% 5% 0% Energy GFF Livestock Industrial Metals Precious Metals Timber Water Coal Allocations as of: 11/30/2012 12/31/2012 1/31/2013 2/28/2013 3/31/2013 4/30/2013 Performance Discussion:  The Precious Metals sector was hit very hard in the month and drove the majority of the negative performance.  The weights and contribution to the prior month’s performance by sector is in Chart 13.00% -2.

41 1.56 Total 100.26 0. returns and contributions as of April 30. returns and contributions as of April 30.IQ Global Agribusiness Small Cap Index (IQSMAGR)  Table 9 details the sector allocations. Table 9: Sector Weights.00 -0.28 -0.64 Agricultural Supplies and Logistics 14. and Contributions IQ Global Agribusiness Small Cap Index Sector Avg Wt Return Contribution Agricultural Chemicals 19.08 5. Real Estate Small Cap Index (IQSMRES)  Table 11 details the sector allocations.19 Crop Production and Farming 37.84 IQ U.01 Specialized REIT 14. Table 11: Sector Weights.51 0.75 0.08 0.12 3. 2013.29 4. 2013 Table 10: Sector Weights. returns and contributions as of April 30.68 Biofuels 4.28 IQ Global Oil Small Cap Index (IQSMOIL)  Table 10 details the sector allocations.16 0.36 -3. Real Estate Small Cap Index Sector Avg Wt Return Contribution Diversified REIT 8. Returns.70 1.94 0.44 3.05 Hotel REIT 11.85 0.S. and Contributions IQ U.08 -0.12 Page 15 .06 4.61 0. Returns.71 Exploration & Production 35.00 3.75 Total 100.S.93 0.22 0.41 -4. Services & Drilling 34.02 Retail REIT 14.77 Residential REIT 4.19 1.07 7. 2013.64 1.19 -0.84 0.62 -1.93 0.43 Refining & Marketing 30.83 1.50 0.21 Mortgage REIT 28.46 Total 100. Returns.83 -0.32 Office REIT 19. and Contributions IQ Global Oil Small Cap Index Sector Avg Wt Return Contribution Equipment.44 -1.34 Livestock Operations 24.11 -3.00 0.

08 10.35 16. Page 16 .1% 6.00% 50.00% -10. Data as of April 30. 2013.00% 13.9% IQ Global Oil Small Cap Index (4) YTD 1.00 20.57 IQ Global Resources Index IQ Global Agribusiness Small Cap Index IQ US Real Estate Small Cap Index IQ Global Oil Small Cap Index * Yield represents the estimated yield based on current index components and the prior payout history of the components.00 30.53 16.18 15.0% 13.00% Comparative Index-Last 12 Months Comparative Index-YTD 30.54 2.Chart 14 contains selected characteristics for the Real Asset indices.47 2.5% -3.00% 40.4% -4.9% Last 12 Months IQ Global Agribusiness Small Cap Index (2) YTD 4.00 Trailing P/E (excl neg EPS) Wtd Average Mkt Cap ($BB) Yield* P/BV $2.2% Last 12 Months IQ US Real Estate Small Cap Index (3) YTD 15.20 $34.00% (3) DJ US Real Estate Index (4) WTI Spot Oil Data as of April 30.00 35.6% 20.1% 22.92 1.00 5.00% IQ Index-Last 12 Months IQ Index-YTD (1) DJUBS Total Return Index (2) DAX Global Agribusiness Index 10.20 1. Past performance is not a guarantee of future results.4% Last 12 Months -10.49 1. Chart 15 contains the last 12 months and year-to-date returns for the Real Asset indices and their respective comparison indices (as detailed in the chart footnotes) Chart 15: Performance: Real Asset indices 0. Source: Factset and IndexIQ research.00 11.11 $3.00 25.4% 13.8% -20.7% Last 12 Months IQ Global Resources Index (1) YTD -5.4% 41.50 2.9% 8.41 $1. Source: Factset and IndexIQ research. 2013.1% 8.79 5.00 16. Chart 14: Valuation Chart: Real Asset indices 40.41 5.00% 0.00 0. The actual index yield may be different.

0% -2. Bloomberg. Source: Factset.0% -8.0% 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 01 3 /2 /2 9 04 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /3 0 01 3 /2 8 /0 1 /0 2 /0 3 /0 4 /0 5 /0 8 /0 9 /1 0 /1 1 /1 2 /1 5 /1 6 /1 7 /1 8 /1 9 /2 2 /2 3 /2 4 /2 5 04 03 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 04 /2 6 IQ Australia Small Cap IQ Canada Small Cap MSCI AC World Data as of April 30. 2013. Page 17 04 . Chart 16: IndexIQ International indices Cumulative Performance Cumulative Performance -April 2013 4.05% -5.0% -4.72% -3.86% -9. IndexIQ research.75% 15.51% MSCI AC World 2.45% 0. Past performance is not a guarantee of future results. IQ International Indices The performance of the IndexIQ International indices is detailed in Table 12.0% 2.48% -8.VI.0% Cumlative Return -6.0% -14. Table 12: IndexIQ International indices Performance Through 4/30/2013 1 Month 3 Months YTD Last 12 Months IQ Australia IQ Canada Small Small Cap Index Cap Index -4.0% -16.82% -14.0% -10. The cumulative index performance for the prior month for the IndexIQ International indices is displayed in Chart 16.0% -12.41% -5.89% 9.69% Past performance is not a guarantee of future results.0% 0.95% 4.

95 Capital Goods 15.23 -5.85 -9.10 0.41 100.00 Trailing P/E (excl neg EPS) Wtd Average Mkt Cap ($BB) IQ Australia Small Cap Index Yield* IQ Canada Small Cap Index P/BV * Yield represents the estimated yield based on current index components and the prior payout history of the components.34 -5. returns and contributions as of April 30.76 -2.82 27.20 0.31 -0.48 4.19 38. Table 13: IQ Australia Small Cap Index (IQSMAUS) & IQ Canada Small Cap Index (IQSMCAN) IQ Australia Small Cap IQ Canada Small Cap Sector Avg Wt Return Contribution Avg Wt Return Contribution Basic Materials 24.00 6.95 0.04 0.12 2.00 10.00 8. 2013.41 -4.00 5.35 0.33 2.00 14.36 12.66 2. Chart 17 contains selected characteristics for the International indices.43 -0.58 $1. Page 18 .86 14.97 15.34 Financials 7.00 2.07 Consumer Staples 7. Chart 17: Valuation Chart: International indices 18.71 3. Past performance is not a guarantee of future results.36 -15.25 -0.14 -0.26 2.07 5.23 2. Data as of April 30.07 Health Care 5.05 Technology 0.23 2.72 7. The actual index yield may be different.65 -0.01 2.27 Communication Services 1.71 -4.68 1.00 14.91 -9.54 0.99 8.00 Consumer Cyclicals 26.99 2.00 4. IndexIQ research.17 3.16 0.96 11.50 -1.57 9.00 -4.45 -1.00 -5.25 0.72 -5.11 0.90 1. 2013.90 0. Source: Factset and IndexIQ research. Source: Factset.53 0.74 0.30 5.96 0.01 Transportation 1.20 4.00 $1.10 1.14 3. Table 13 details the sector allocations.99 -0.22 -0.27 Energy 7.49 -2.72 Data as of April 30.00 16.70 0.16 Utilities 0.19 0.62 -14. 2013.13 Total 100. Bloomberg.26 0.

0% -0.00% 5. Page 19 .00% -5.2% -20.00% 25. gross dividends) Data as of April 30.5% Last 12 Months IQ Canada Small Cap Index (1) YTD -8.2% 25. USD.00% IQ Index-Last 12 Months IQ Index-YTD 0. Chart 18: Performance: International indices -5.00% 30.Chart 18 contains the last 12 months and year-to-date returns for the International indices and their respective comparison indices (as detailed in the chart footnotes).5% 14.00% 15.00% Comparative Index-Last 12 Months Comparative Index-YTD (1) MSCI Large Cap Index (total return.00% 10.00% -10.00% -15. Source: Factset and IndexIQ research.7% -14.8% Last 12 Months IQ Australia Small Cap Index (1) YTD 0. 2013.4% 2.00% 20.

Past performance is not a guarantee of future results. Additional information about the company and its products can be found at www. risks. market neutral. There is no guarantee that capital gains distributions will not be made in the future. Please consult your tax professional or financial adviser for more information regarding your tax situation. leverage risk. which subject them to risk of loss not typically associated with domestic markets. it is exposed to concentration risk. as applicable. Mutual Funds & Separate Accounts. Past distributions are not indicative of future distributions. charges and expenses carefully before investing.com or by calling (888) 934-0777. The Index also includes short exposure to global equities as a partial equity market hedge. The fund is not suitable for all investors. including in the areas of exploration and production. One cannot invest directly in an index. The Fund is concentrated in small capitalization companies. The performance data quoted above represents past performance. To obtain a copy of the SPDR S&P 500 ETF (SPY) prospectus which contains this and other information call 1-866-787-2257. *Ordinary brokerage commissions apply. Page 20 . commodities markets. which is published by the Bureau of Labor Statistics. agricultural machinery. services and drilling. fixed income arbitrage and emerging markets. Index performance is for illustrative purposes only and does not represent any actual fund performance. liquid and transparent products. Results prior to an index component's existence as an ETF are based on its underlying index. because they are funds of funds. Your own trading will also generate tax consequences and transaction expenses. The IQ Global Resource Index uses momentum and valuation factors to identify global companies that operate in commodity-specific market segments and whose equity securities trade in developed markets. including possible loss of principa l. refining and marketing. depends on the investment performance of the underlying ETFs in which they invests. QMN and CPI. agricultural supplies & logistics. property risk and management risk. including long/short equity. The underlying ETFs invest in: foreign securities. livestock operations. This differentiated approach is based on a passive strategy of owning certain announced takeover targets with the goal of generating returns that are representative of global merger arbitrage activity. The IQ Global Oil Small Cap Index provides exposure to global small cap companies engaged in the oil sector.indexiq. IndexIQ’s ETF holdings are available daily on IndexIQ’s website. Investors in the Fund should be willing to accept a high degree of volatility in the price of the Fund's Shares and the possibility of significant losses. real asset and international strategies. The IQ Global Agribusiness Small Cap Index provides exposure to global small cap companies engaged in the agribusiness sector. which subject them to greater volatility than investments in traditional securities. you must be a registered shareholder of the fund on the record date. agricultural chemicals. Distributions are paid to shareholders on the payment date. transaction costs or o ther expenses that you would pay if you invested in a fund directly. To receive a distribution. interest rate risk. The IQ Hedge Macro Index seeks to replicate the risk-adjusted return characteristics of a combination of hedge funds pursuing a macro strategy and hedge funds pursuing an emerging markets strategy. As ROOF’s investments are concentrated in the real estate sector. event-driven.S. including the U. IndexIQ solutions are offered as ETFs. Performance may be lower or higher than performance data quoted. such as stocks and bonds. as rep resented by the Consumer Price Index. The IQ Australia Small Cap Index and the IQ Canada Small Cap Index seek to achieve capital appreciation by investing in small cap companies that make up the bottom 15% of the market capitalization of Australia and Canada respectively. including crop production and farming. IndexIQ’s ph ilosophy is to democratize investment management by making innovative alternative investment strategies available to investors in low cost. The investment performance of QAI. such as currency fluctuations and political uncertainty.com. Consider the Funds’ investment objectives. and fixed income securities. An investment in the Fund involves a substantial degree of risk and the Fund does not represent a complete investment program. IQ Alpha Hedge Index seeks to provide superior returns and lower volatility relative to the S&P 500 Index. inflation rate by providing a “real return” or a return above the rate of inflation. global macro. ETFs are liquid in that they are exchange-traded. Investors are reminded that all investing involves risk.* IndexIQ strategies are marketed through the company’s proprietary investment produ cts and select partnerships with leading global financial institutions. The IQ Real Return Index seeks to provide a hedge against changes in the U. whose stock prices generally are more volatile than those of larger companies.IndexIQ. Performance data for the indexes assumes reinvestment of dividends and is net of the management fees for the indexes’ components. A prospectus with this and other information about the Funds may be obtained by visiting www. The IQ Hedge Multi-Strategy Index seeks to replicate the risk-adjusted return characteristics of hedge funds using various hedge fund investment styles. Read the prospectus carefully before investing. and biofuels.About IndexIQ IndexIQ is a leading issuer of index-based liquid alternative solutions focused on absolute return. and also seeks to provide correlation that is similar to the correlation between hedge funds generally and the S&P 500 Index. The Fund is non-diversified and is susceptible to greater losses if a single portfolio investment declines than would a diversified fund.S. which subject them to credit risk – the possibility that the issuer of a security will be unable to make interest payments and/or repay the principal on its debt – and interest rate risk – changes in the value of a fixed-income security resulting from changes in interest rates. The IQ Merger Arbitrage Index seeks to achieve capital appreciation by investing in global companies for which there has been a public announcement of a takeover by an acquirer. which do not reflect underlying management fees. but it does not reflect management fees. and equipment.

Not to be disseminated to the public. Market price returns do not represent the returns you would receive if you traded shares at other times. Investment professional use only. (ALPS) is the distributor for IndexIQ ETFs and Mutual Fund. Market price returns reflect the share price as of the close of trading on the exchange where Fund shares are listed. ALPS Distributors. Total Returns are calculated using the daily 4:00 pm ET net asset value (NAV). IDX001222.IndexIQ shares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. the SPDR S&P 500 ETF (SPY) and certain underlying fund holdings only.050214 Page 21 . Salvatore Bruno is a registered representative of ALPS. Inc.