Deutsche Bank’s Exchange Traded Commodity (db ETC) platform today announces the listing of ten new Exchange Traded Commodities (ETCs) on the London Stock Exchange.
The new ETC range enables investors to gain simple and efficient exposure to a wide spectrum of commodities. This includes the db Physical Gold ETC and the db Physical Silver ETC that are backed by the relevant precious metal being tracked by the ETC.
Also being launched are a range of index linked ETCs such as the db S&P GSCI Industrial Metals ETC and db Energy Booster ETC which are unique because the exposures to the swap transactions incorporated in these ETCs are fully collateralised with physical gold.
Another distinguishing feature of some of the index linked ETCs is that they are linked to Deutsche Bank’s Optimum Yield commodity indices. The indices underlying ETCs are typically linked to the performance of a basket of commodity futures contracts. Due to the costs (or gains) associated with “rolling” commodity futures contracts (i.e. selling a maturing contract and buying a new one) there may be a divergence between the spot and future price of a commodity. The “Optimum Yield” technique represents a way of investing into commodities with the aim of minimising such costs (or maximising gains) from the “rolling” of commodity futures contracts. The index linked ETCs which utilise the Optimum Yield technique have the word “Booster” in their name.
All of the db ETC products have competitive fees and are offered with full liquidity through Deutsche Bank which acts as market maker for all of the products. These ten new db ETC products add to the range of 19 which were listed on Xetra Frankfurt earlier this year.
Deutsche Bank Exchange Traded Product (ETP) research shows that the ETC market is one of the fastest growing investment segments in the ETP market. Total assets in ETPs across Europe grew by 145% in 2009, compared to only 43% in equities and 17% in fixed income.
David Silbert, Global Head of Commodities at Deutsche Bank said, “The ETC platform offers investors a simple, efficient and liquid way to gain exposure to a wide range of commodities at a competitive price. We anticipate strong demand for these products.”
Overeview of the ten new db ETCs listed on the London Stock Exchange