db x-trackers lists the world's first ETF on hedge funds
Deutsche Bank has launched the world’s first Exchange Traded Fund (ETF) based on actual hedge funds, providing liquid, exchange-tradable access to the hedge fund asset class.
The hedge fund ETF, which is UCITS III compliant, is linked to the db Hedge Fund Index – a proprietary Deutsche Bank index that captures core hedge fund strategies (equity hedge, market neutral, credit and convertible, systematic macro and event driven) in a liquid and transparent format. Each strategy is reflected by a sub-index which is represented in the main index according to recognised industry asset weightings.
Each sub-index is linked to the performance of its constituent hedge funds sourced from Deutsche Bank’s leading hedge fund managed accounts platform. The platform is a risk controlled, liquid and transparent investment platform representing a broad spectrum of hedge fund strategies. The funds on the platform are run by Deutsche Bank entities with external third party hedge fund managers appointed to manage each underlying portfolio.
Stephane Farouze, global head of hedge fund derivatives at Deutsche Bank comments, “The structure of the hedge fund managed account platform means that all the funds in the ETF index are subject to Deutsche Bank’s continuing daily risk monitoring process and that investors also have a higher level of transparency than with traditional hedge fund products. For investors wanting access to hedge fund returns, this ground breaking ETF offers unprecedented transparency and as well as intra day liquidity compared to at best monthly or even quarterly liquidity for a traditional hedge fund investment.”
Thorsten Michalik, head of db x-trackers adds, “This new product again demonstrates Deutsche Bank’s capabilities as the leading innovator in the European ETF space. For the first time, investors will have liquid, UCITS III access to the hedge fund industry. Market participants will also be able to base their financial products on the ETF, as Deutsche Bank will be the market maker and will offer two way prices on and off the stock exchange.”
All hedge funds on the managed account platform are Jersey unit trusts listed on the Irish Stock Exchange and managed and administered by legally separate Deutsche Bank affiliates. Third party hedge fund managers are sub-contracted to each platform fund as a trading advisor and their responsibility is to manage the portfolio for a given fund. The platform is a risk-monitored and transparent framework benefiting from the following:
- Position level data for each fund for Deutsche Bank’s Risk Monitoring group
- Daily Risk Monitoring by Deutsche Bank to ensure each trading advisor complies with the agreed investment guidelines for each fund
- Third party regulatory oversight by the Irish Stock Exchange and the Jersey Financial Services Commission
- Fund pricing independent to the Trading Advisor
- Auditing by KPMG.
The index level of the db Hedge Fund Index is independently calculated on a T + 3 business day DBIQ. The index is calculated on a total return basis and started on 31 December 2008. Index levels are posted on Bloomberg and on the DBIQ website (https://index.db.com/).
The ETF on the db Hedge Fund Index has a management fee of 0.90% p.a., is listed on the Frankfurt Stock Exchange and Euro Hedged. The ETF was listed on the 11 March 2009 in Frankfurt. During the course of 2009 further listings in Europe are planned.
Please find more information in attached presentation or please contact:
Michelle Gathercole, press and media relations (+44) 020 7545 4249
About db x-trackers
db x-trackers is Deutsche Bank’s Exchange Traded Funds (ETFs) index tracking solution platform. db x-trackers was launched in January 2007 and is currently the fastest growing ETF provider in Europe. Over EUR 19 billion of assets under management have been raised in two years, making db x-trackers one of the three largest ETF providers in Europe.
db x-trackers offers more than 100 ETFs across asset classes including equity, fixed income, credit, money markets, currencies and commodities; enabling anyone the opportunity to invest in a highly transparent, flexible and efficient way. db x-trackers offer investors the largest range of ETFs on short indices covering equity, bonds and credit indices.
db x-trackers’ ETFs are listed on five different exchanges across Europe (Frankfurt Xetra, Borsa Italiana, Paris Euronext, London Stock Exchange and Zurich SIX Swiss Exchange) and are supported by multiple market makers. db x-trackers ETFs are domiciled in Luxembourg and comply with UCITS III regulations.
With EUR 6 billion assets under management, the db x-trackers II EONIA TR Index ETF is the single largest ETF in Europe. In the two years since inception the db x-trackers’ fixed income range has become the largest in Europe and has more assets under management than any other ETF provider in Europe.
The db x-trackers SHORT DAX® and db x-trackers DJ EURO STOXX50® Short ETFs were among the best performing funds in Europe during 2008.
More information on db x-trackers can be found on http://www.dbxtrackers.com/. All of the above data was correct as at 31.12.2008.
About Deutsche Bank
Deutsche Bank is a leading global investment bank with a strong and profitable private clients franchise. A leader in Germany and Europe, the bank is continuously growing in North America, Asia and key emerging markets. With 80,456 employees in 72 countries, Deutsche Bank offers unparalleled financial services throughout the world. The bank competes to be the leading global provider of financial solutions for demanding clients creating exceptional value for its shareholders and people.
Presentation "db Hedge Fund Index ETF"Press Release