Deutsche Asset & Wealth Management (DeAWM) is creating a range of low cost, direct (physical) replication db X-trackers ETFs, all of which will come with an all-in fee (TER) of 0.09 per cent (nine basis points) per annum.
The underlying benchmark indices will be the DAX, FTSE 100, EuroStoxx 50, and the MSCI USA.
The initiative aims to serve the needs of all types of investors aiming for efficiency in holding and trading ETFs. As well as appealing to long-term, buy-and-hold investors seeking core portfolio holdings, the range is also expected to compete with non exchange-traded index trackers, which typically have relatively low total expense ratios.
The TER on the db x-trackers FTSE 100 UCITS ETF (DR) has been reduced from 0.30 per cent per annum to 0.09 per cent per annum, while the TER on the db x-trackers DAX UCITS ETF (DR) has fallen from 0.15 per cent per annum to 0.09 per cent per annum. Making up the rest of the “nine basis points ETFs” will be db X-trackers ETFs on the EuroStoxx 50 Index, following its switch from indirect to direct, physical replication, as well as a new launch ETF on the MSCI USA Index – both planned for around the end of the first quarter.
Reinhard Bellet, DeAWM’s head of passive asset management, says: “With this range of low TER ETFs we aim not just to enhance our offering to current investors, but also to broaden our investor base. The combination of low TERs, intraday liquidity, visibility and transparency offered by our ETFs should make them appeal to an even wider cross-section of the investor community.”
In December 2013 DeAWM announced it would switch 18 of its largest ETFs from indirect, synthetic replication, to direct, physical replication. This project is now well under way, and the introduction of a low TER range is a further development aimed at responding to investor demand.
