DeAWM expands currency-hedged ETF lineup

Jan 23rd, 2014 | By | Category: Equities

Deutsche Asset & Wealth Management (DeAWM), a leading global provider of exchange-traded funds and a division of Deutsche Bank, has expanded its lineup of currency-hedged ETFs with the launch of three new db X-trackers funds on the NYSE Arca.

DeAWM expands currency-hedged equity ETF lineup

Martin Kremenstein, Head of Passive Asset Management for Deutsche Asset & Wealth Management Americas.

The new ETFs provide exposure to international, South Korean and Mexican equity markets while mitigating fluctuations in the value of the US dollar and foreign currencies.

The additional funds take DeAWM’s suite of currency-hedged equity ETFs to a total of eleven ETFs.

Similar to the provider’s existing currency-hedged equity ETFs, the funds are linked to indices from MSCI.

The indices aim to represent the returns of an MSCI parent equity index with its currency risk hedged back to a single “home country” currency.

The new funds and their NYSE Arca tickers are:

db X-trackers MSCI All World ex US Hedged Equity Fund (DBAW)
db X-trackers MSCI South Korea Hedged Equity Fund (DBKO)
db X-trackers MSCI Mexico Hedged Equity Fund (DBMX).

DBAW seeks to track the MSCI ACWI ex USA US Dollar Hedged Index, which includes more than 1800 constituents from across 22 developed markets (excluding the US) and 21 emerging markets countries, while managing the currency risk from those markets. The fund has total expense ratio (TER) of 0.40%.

DBKO, which has a TER of 0.58%, allows investors access to the South Korean equity market, while managing exposure to the Korean Won. It seeks to track the MSCI Korea 25/50 US Dollar Hedged Index.

DBMX offers the opportunity to access Mexico, one of the major emerging Latin American economies, while hedging the currency risk and reducing the impact of fluctuations between the Mexican Peso, relative to the US dollar. The fund seeks to track the MSCI Mexico IMI 25/50 US Dollar Hedged Index. It has a TER of 0.50%.

Commenting on the launch of the funds, Martin Kremenstein, Head of Passive Asset Management for DeAWM Americas, said: “In the current market environment, investors are looking for products to help them manage exposure to currency risk in their international investments. For this reason, we continue to expand our hedged equity platform to include countries and regions where the management of currency risk can strengthen a global equity portfolio.”

DeAWM’s US exchange-traded products (ETP) platform currently has $12 billion in assets under management. Globally, the firm has approximately $66 billion in ETP assets under management (as of September 30, 2013).

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