The total fund volume in the XTF segment reached a record €13.6 billion at the end of March, up 124 percent year-on-year. The segment's turnover is also continuing to grow. In Q1/ 2004, the XTF segment generated €9.9 billion in turnover, the second-best result in its history. The leading ETF in terms of turnover in Q1 was the DAX EX, which generated an average monthly turnover of €1.66 billion.
Demand for fixed-income ETFs, which were introduced around a year ago, is growing at a particularly rapid rate. In March 2004 alone, the total fund volume for the five listed fixed-income ETFs rose by 188 percent month-on-month to total €1.75 billion. The leading fixed-income ETF is currently the eb.rexx Government Germany 2.5-5.5 EX, an ETF that comprises German government bonds with medium maturities and includes assets of around €1.15 billion.
"The strong growth of the XTF segment is testimony to the attractiveness of these products for investors. Both private and institutional investors have recognized the advantages of ETFs", said Rainer Riess, Head of Stock Market Business Development and thus responsible for the XTF segment. "ETFs provide both groups of investors with a cost-effective way of investing in a variety of different markets and sectors."Investors that use Xetra to trade in ETFs benefit from fast order execution, high price quality and low trading costs. The absence of front load fees and the high transparency of the XTF segment, thanks to the comprehensive information available on the Internet, is welcomed by private investors in particular.
Deutsche Börse offers a one-stop shop for all trading information for ETF: real-time trading data on the ETFs and underlyings, the indicative net asset values of the ETFs and ETF derivatives on the Eurex derivatives market. Deutsche Börse will be running a pilot phase in cooperation with information providers in April and May for private investors, and in May and June for institutional investors, during which these investors will be given free access to real-time data.
As a result of its success in ETF trading, Deutsche Börse was voted the "most innovative" and the "largest" European exchange in the exchange-traded fund segment by market participants in February. Deutsche Börse received these awards as part of the "European ETF Awards" program that has been run by the International Fund Investment Magazine for the past two years.
Exchange-traded funds are index funds that can be traded continuously like equities on the stock exchange at the current market price. There are no front load fees for the purchase of fund shares through the stock exchange; all the investor has to pay are the usual transaction costs for the purchase and sale of securities. Investors can buy the shares through any bank that offers trading in equities. At present, 55 ETFs are listed on Deutsche Börse's XTF segment. Roughly 99 percent of the turnover in fund products in Germany is posted through Xetra, which means that all of the main trading parameters from equities trading are also valid for XTF. These include continuous trading, auctions, a minimum lot of one fund share as well as Designated Sponsors who provide for liquidity.
