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Deutsche Bank and UBS cut ETF fees

Deutsche Bank has cut the ongoing charge on a number of its equity ETFs by up to one-third
April 27, 2017

Deutsche Bank has cut the ongoing charges on 28 of its equity exchange traded funds (ETFs) by up to one-third, meaning that it now offers the cheapest Japanese currency-hedged ETF on the London Stock Exchange.

Deutsche Bank cut one-third from the price of its sterling hedged db x-trackers MSCI Japan Index UCITS ETF (XMJG), taking its ongoing charge down from 0.6 per cent to 0.4 per cent. That undercuts rivals WisdomTree Japan Equity UCITS ETF GBP Hedged (DXJP), which has an ongoing charge of 0.45 per cent, Amundi ETF Japan Topix UCITS ETF Daily Hedged (TPHG), which has an ongoing charge of 0.48 per cent, and iShares MSCI Japan GBP Hedged UCITS ETF (IJPH) at 0.64 per cent.

Deutsche Bank has also cut the price on the unhedged share class of db x-trackers MSCI Japan Index UCITS ETF 1C (XMJD), so that its ongoing charge falls from 0.5 per cent to 0.3 per cent.

And it has cut the price of a number of US, emerging markets, European and global equity ETFs by between 0.05 and 0.20 per cent.

db x-trackers S&P 500 UCITS ETF's (XSPX) ongoing charge has fallen from 0.2 per cent to 0.15 per cent, making it the cheapest Deutsche Bank ETF outside of that company's low-cost core range. However, there are cheaper S&P 500 ETFs listed in London: Vanguard S&P 500 UCITS ETF (VUSA) and iShares Core S&P 500 UCITS ETF (CSPX) both have an ongoing charge of 0.07 per cent.

db x-trackers MSCI AC World Index UCITS ETF (XMAW), meanwhile, has seen its ongoing charge fall from 0.5 per cent to 0.4 per cent, db x-trackers MSCI Emerging Markets Index UCITS ETF's (XMEM) ongoing charge has fallen from 0.65 per cent to 0.49 per cent, and db x-trackers MSCI Europe Index UCITS ETF (XMEU) has fallen from 0.3 per cent to 0.25 per cent.

Deutsche Bank said the cuts were made "to thank loyal clients for their continued support" and mark the 10-year anniversary of the launch of its ETF business in Europe.

UBS, meanwhile, has slashed the price of its US inflation-linked bond ETF amid a spate of inflows. Expectations that President Donald Trump's spending plans could lead to US inflation have pushed investors into UBS's Treasury Inflation Protected Securities (TIPS) ETF and enabled it to cut fees.

UBS ETF Barclays TIPS 1-10 UCITS ETF's (UBTS) ongoing charge has fallen from 0.2 per cent to 0.15 per cent, and the sterling hedged share class of this fund (UBTP) now costs 0.20 per cent, down from 0.25 per cent.

This ETF has attracted inflows of $470m (£366.25m) since the start of 2017 and its total assets have surpassed $600m. Similar ETFs listed on the London Stock Exchange include iShares $ TIPS UCITS ETF (IDTP) with assets of $3.7bn and an ongoing charge of 0.25 per cent and Lyxor US TIPS UCITS ETF (TIPG), which has assets of $317.6m and an ongoing charge of just 0.09 per cent.

Lyxor became the cheapest provider of fixed-income ETFs in 2016 when it slashed the cost of a wide range of UK and US government and corporate bond ETFs.

 

Deutsche Bank and UBS fee cuts

ETFOld ongoing charge (%) Ongoing charge (%)
UBS ETF (LU) Barclays TIPS 1-10 UCITS ETF (UBTS)0.200.15
UBS ETF (LU) Barclays TIPS 1-10 hedged to GBP UCITS ETF (UBTP) 0.250.20
db x-trackers MSCI AC World Index UCITS ETF (DR) (XMAW)0.500.40
db x-trackers MSCI Europe Index UCITS ETF (DR) 1D (XIEE) 0.300.25
db x-trackers MSCI Europe Index UCITS ETF (DR) USD (XMEU)0.350.25
db x-trackers MSCI Europe Mid Cap Index UCITS ETF (DR) (XEUM)0.400.25
db x-trackers MSCI Europe Small Cap Index UCITS ETF (DR) (XXSC)0.400.30
db x-trackers S&P 500 UCITS ETF 1C (XSPX)0.200.15
db x-trackers S&P 500 UCITS ETF (DR) 2C GBP hedged (XDPG)0.300.20
db x-trackers Russell 2000 UCITS ETF (DR) (XRSU)0.450.30
db x-trackers MSCI Japan Index UCITS ETF (DR) (XMJD) 0.500.30
db x-trackers MSCI Japan Index UCITS ETF (DR) (XMJG) 0.600.40
db x-trackers MSCI World Consumer Discretionary Index UCITS ETF (DR) (XDWC)0.450.30
db x-trackers MSCI World Consumer Staples Index UCITS ETF (DR) (XDWS)0.450.30
db x-trackers MSCI World Energy Index UCITS ETF (DR) (XDW0)0.450.30
db x-trackers MSCI World Financials Index UCITS ETF (DR) (XDWF)0.450.30
db x-trackers MSCI World Health Care Index UCITS ETF (DR) (XDWH)0.450.30
db x-trackers MSCI World Industrials Index UCITS ETF (DR)*0.450.30
db x-trackers MSCI World Information Technology Index UCITS ETF (DR) (XDWI)0.450.30
db x-trackers MSCI World Materials Index UCITS ETF (DR) (XDWM)0.450.30
db x-trackers MSCI World Telecom Services Index UCITS ETF (DR) (XWTS)0.450.30
db x-trackers MSCI World Utilities Index UCITS ETF (DR) (XDWU)0.450.30
db x-trackers MSCI Emerging Markets Index UCITS ETF (XMEM)0.650.49

Source: UBS and Deutsche Bank Asset Management, as at 1 April 2017