Deutsche Bank has launched an exchange-traded commodities investment issuance platform with the launch of four new products on the Frankfurt Stock Exchange (Xetra).
The new platform, branded db ETC, will roll out to the rest of Europe in 2010 and include ETCs on gold, silver, platinum and palladium.
The ETC market is one of the fastest growing investment segments in the exchange-traded product market. According to a recent Deutsche Bank Research report, total assets in ETC products across Europe grew by 145 per cent in 2009, compared to only 43 per cent in equities and 17 per cent in fixed income.
Global head of commodities David Silbert says: “Exchange-traded commodities issued by Deutsche Bank’s db ETC platform offer a simple way for investors to gain exposure to commodities without trading the futures contracts or taking physical delivery of the commodities they track. Our index linked ETCs offer full collateralisation of the product using physical gold, while competitors use baskets of equity and bonds. Our ETCs also offer fully liquid trading provided by Deutsche Bank as a market maker of the products.”
In addition to USD ETCs Deutsche Bank will be offering Euro-hedged products on the platform. Since commodity products by definition carry USD exposure, Deutsche Bank aims to make commodities available to investors that want to have access to this asset class without USD exposure.
Besides Euro-hedged and USD products on benchmark commodity indices, db ETC will provide access to Deutsche Bank’s own Optimum Yield commodity indices. This technique represents a way of investing into commodities with a view to maximising gains and minimising losses from the “rolling” of commodity futures contracts.