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Deutsche Börse Commodities launches Xetra-Gold on Luxembourg market


Xetra-Gold, a financial product that combines the benefits of physical gold with those of exchange-traded securities is being launched to investors on the Luxembourg market by Deutsche B&o

Xetra-Gold, a financial product that combines the benefits of physical gold with those of exchange-traded securities is being launched to investors on the Luxembourg market by Deutsche Börse Commodities following its introduction in Germany last December.

Xetra-Gold is a bearer note that can be bought and sold via Deutsche Börse’s Xetra trading platform, and every unit represents the option of one gram of gold to be delivered. The securities issued can be traded on an ongoing basis without delay and – if so requested – can be exchanged for the underlying physical amount of gold via the private investor’s own bank.

According to Deutsche Börse Commodities, the product combines the security of physical gold with the low cost of trading securities on Xetra, making it an ideal product for risk diversification. Exchange-based trading makes Xetra-Gold a fungible and liquid security with a transparent pricing process, and the issued security fulfils the European Ucits criteria for investments funds, making it eligible for institutional investors such as investment funds.

Clearstream Banking Frankfurt, a Deutsche Börse clearing subsidiary, provides safekeeping the gold in its vault, saving investors the costs of transporting and storing physical gold, while Umicore, an industry partner, supplies, checks and handles the physical gold.

Deutsche Börse Commodities is a joint venture launched in November 2007 by Deutsche Börse with partners Bankhaus Metzler, Bank Vontobel, Commerzbank, Deutsche Bank, DZ Bank and Umicore that aims to offer innovative types of securitisation for commodities and ensure cost-effective trading.

‘We are delighted to introduce Xetra-Gold to the Luxembourg market,’ says Martina Gruber (photo, right), managing director of Deutsche Börse Commodities. ‘We believe it will encounter the same success in the Grand Duchy it has received on the German market, where results have exceeded expectations.’

Of 114 exchange-traded commodities listed on the Frankfurt Stock Exchange, Xetra-Gold has the highest turnover, the firm says. The order book turnover in October reached EUR190.8m, equivalent to 49 percent of all turnover for exchange-traded commodities.

Steffen Orben (photo, left), managing director of Deutsche Börse Commodities, adds: ‘With innovative securitisation, we offer investors direct access to the commodities market and a cost-effective opportunity to diversify their portfolios, which is particularly valuable in times of market turmoil.’

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