Good Morning Mr. Mistry, last year was characterized by events that have impacted heavily on the financial markets. The financial clones sector appears to have suffered less from these variations, but is this true? …
Can you tell us what were the results for your ETF and are you satisfied?
You are right, the year 2008 has not been a good year for equities and in addition, the mutual fund industry has seen large outflows. Nevertheless, though the challenging situation the Exchange Traded Funds industry weathered the storm. At db x-trackers we have seen total net inflows of EUR 13.6 bn during 2008. Saying this, we are satisfied with what we achieved given the unfavourable market conditions.
2009 has begun and investors are questioning which assett class is best for them. In your view, which field or area will give the best results. Why?
When deciding where to invest one has to take into account different aspects. When investing e.g. in a money market ETF like the db x-trackers Sterling Money Market ETF, the risk will clearly be lower than if an investment is made into an emerging markets ETF like the db x-trackers MSCI Emerging Markets TRN Index ETF. However, when looking at the potential return it might be more attractive to invest into equity ETFs rather than money market ETFs. Summed up, investors should take into account the risk, e.g. in terms of historical volatility of an asset class, as well as the potential yield expected. db x-trackers offers many different and innovative products investors can choose from like equity, currency, commodity, money market, sovereign bond and credit ETFs. Each asset class has a specific risk/return profile and therefore, investors are able to select ETFs that match their risk profile as well as their return expectations.
The ETF industry erose to meet the needs of institutional investors and in Italy it has begun to attract the attention of retail investors. Can the same trend be found on the British market or not?Do you think that 2009 could be the year these tools are embraced by both retail investors and the general public? Why?
Currently ETFs are widely used by institutional investors such as pension funds, asset management and insurance companies, funds and investment advisors. As db x-trackers ETFs are exchange listed, retail investors do have access to our products, as well. Nevertheless, as the fees with ETFs are agressively calculated there is no active distribution to retail clients. We are working with stockbrokers and investment advisors in order to attract more retail clients via these platforms going forward. It is important to say that ETFs are the instruments many retail clients are looking for. The reason is that ETFs do offer what investors are really looking for when it comes to investments: ETFs are transparent, exchange traded and agressively priced. In addition, db x-trackers covers all asset classes with more than 100 ETFs to date. Is there any better way to invest?
There is a subtle argument, on the development model for ETFs. There are those who prefer the ETF standard and those who are pushing for the new structured ETF. What is your position on this and why?
I assume you are speaking about traditional, fully replicated ETFs in comparison to innovative swap-based ETFs. All db x-trackers ETFs are based on a swap structure and clearly, there are many advantages about this structure. For example, db x-trackers ETFs do have a more stable tracking behavior compared to traditional ETFs and the new structure allows for performance enhancements offsetting management fees, in part or even more than the fee itself.
Do you plan to launch new products in 2009? If you have planned new products will these increase your present range or will you try to introduce new sectors?
Yes we are planning to launch many innovative ETFs in 2009. We will not only launch new products but also offer new asset classes to investors. For example, we will launch the first Hedge Fund Index ETF worldwide in the near future. This will allow investors to invest into a diversified index of Hedge Funds with just one single transaction. This is not just a new product but a perfect innovation and I think investors will be highly interested in this product. Of course, we will also launch new equity and bond ETFs and we have already launched several new ETFs earlier this year. db x-trackers is one of the fastest growing ETF providers in the world and we will go ahead being more innovative and more competitive with our products compared to other ETF providers.
Is there a specific topic you want to focus on? If so what is it?
As discussed before, we are focussing especially on launching innovative products as this has been the driver of our ongoing success. Furthermore, we will broaden our product range with equity, commodity, money market, bond, and credit ETFs to come.
Source: ETFWorld.co.uk
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