After making its debut on the SIX Swiss Exchange four months ago, ETF Securities has followed up with the launch of 28 Swiss franc currency-hedged exchange-traded commodities (ETCs) based on Dow Jones-UBS Commodity Indices.
ETF Securities’ initial offering on the exchange in September last year included eight thematic exchange-traded funds delivering access to various investment themes such as agribusiness, coal mining and shipping.
This latest listing expands that offering to provide targeted exposure to all the main commodities, including precious metals (gold, silver, platinum), industrial metals (aluminium, copper, lead, nickel, tin and zinc), energy (WTI, Brent and natural gas) and agriculture (including all the main grains and softs).
In contrast to the majority of commodity ETCs, which expose investors to the vagaries of the foreign exchange market, these new ETCs have been designed to mitigate the effects of currency volatility. Aimed at Swiss franc-referenced investors, the products hedge against movements in the CHF/USD exchange rate, reducing exposure to the US dollar, the currency in which most commodities are priced.
Alain Picard, Head Product Management at SIX Swiss Exchange, said: “We would again like to extend a warm welcome to ETF Securities on SIX Swiss Exchange and are very happy that exchange-traded products (ETPs) of ETF Securities can now also be traded on our exchange. These 28 ETPs newly listed on the Swiss stock exchange are an exciting addition to our existing offer and enable new investments via ETPs in individual commodities and industrial metals.”
Rima Haddad, Head of Sales for Switzerland at ETF Securities, added: “This is ETF Securities’ first launch of commodity ETPs in Switzerland and we are delighted to offer such a broad range of commodity products in the country. We have seen a growing demand for commodities, especially in 2012 as a result of increased liquidity from central banks, concerns over the US fiscal and debt situation and European debt crisis which has translated into a stronger demand for real assets.”
The new ETCs each come with a management expense ratio (MER) of 0.49% per annum and will compete alongside similar (though mainly unhedged) line-ups from Deutsche Bank, Source, and UBS. The cost of currency hedging is built in to index returns.