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Deutsche Asset & Wealth Management (DeAWM), the asset management division of Deutsche Bank, has rolled out two new exchange-traded funds (ETFs) providing exposure to Nordic and Turkish equity markets.
Both funds employ a direct replication methodology (meaning they physically own underlying index securities) and have been listed on the London Stock Exchange and the Deutsche Börse.
The db X-trackers MSCI Nordic Index UCITS ETF (DR) (XDN0) provides exposure to the large and mid-cap sections of the four Nordic countries – Norway, Sweden, Denmark and Finland – via the MSCI Nordic Countries Index.
This index currently has 67 constituents, representing approximately 85% of the free float-adjusted market capitalisation in each country. Sweden has the largest representation in the index, with 53.4%, followed by Denmark with 19.32%, Norway with 13.97% and finally Finland with 13.31%. Major holdings include Novo Nordisk, Ericsson, Hennes & Mauritz, Nordea Bank and Statoil.
The fund has a Total Expense Ratio (TER) of 0.30%.
The db X-trackers MSCI Turkey Index UCITS ETF (DR) (XDTK) tracks the performance of the MSCI Turkey Index, an index reflecting the large and mid-cap sections of the Turkish equity market. This fund has a TER of 0.65%.
With 24 constituents, the MSCI Turkey Index covers around 85% of Turkey’s listed equity sector. The index is dominated by companies in the financials sector, which comprises 51.51% of the index. Major holdings include Turkiye Garanti Bankasi, Akbank, Turkcell Iletisim Hizmet, Turkiye Halk Bankasi and Bim Birlesik Magazalar.
Kai Bald, Head of Public Distribution for Passive Investments at DeAWM, commented: “The Nordic ETF will be welcomed by those investors keen to focus on, or diversify in favour of, this particular part of the continent, which has performed strongly over the past year. The Turkey ETF meanwhile brings even greater choice to our already expansive emerging markets range.”
In terms of alternatives benchmarked to the same underlying indices, the Turkey fund will compete against products from iShares, HSBC and UBS (the latter’s UBS-ETF MSCI Turkey UCITS ETF (UB36) being the cheapest with a TER of just 0.43%) while the Nordic fund will line up against the synthetically replicated Amundi ETF MSCI Nordic UCITS ETF (CN1), which comes with a slightly cheaper TER of 0.25%.
Both funds are eligible for ISAs and SIPPs and have UK reporting fund status.