Deutsche Bank Markets Research Asia Synthetic Equity & Index Strategy Asia-Pac Monthly ETF Insights Date 10 August 2016 EM and Broad Asia Preferred while Japan and China Saw Outflows Data in this report is as of 29th July 2016 ________________________________________________________________________________________________________________ Deutsche Bank AG/Hong Kong Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1.MCI (P) 057/04/2016. Author Shan Lan Strategist (+852) 22036716 [email protected]Team Contacts Ari Rajendra Strategist (+44) 20 754-52282 [email protected]Sebastian Mercado Strategist (+1) 212 250-8690 [email protected]Related recent research Date ETF Annual Review & Outlook - Strong Growth to Continue Despite Volatile Markets 21 Jan 2016 Source: Deutsche Bank Global ETP assets grow to $3.3 trillion amid rising markets and healthy inflows Global ETP AUM was up by 5% ($157bn) last month and reached $3.3tn (11.3% increase YTD), supported by bullish markets and strong inflows. Asia- Pac listed ETPs closed the month at record high assets of $306bn. ETPs listed globally (ex-RoW) received inflows of +$53.7bn over the last month with US ETPs bringing in largest inflows (+$45.7bn), followed by Europe (+$10.6bn) while Asia-Pac ETPs experienced outflows of -$2.6bn. Global ETP flows reached +$164.5bn in total YTD (5.7% of last year end AUM). Global investor positioning: Broad EM and DM preferred, Europe continues to retreat, outflows from Japan and China Based on July flows to ETFs listed globally with regional focus, Broad (global) EM have been most favoured receiving major inflows, followed by Broad (global) DM, which was being preferred most during H1 period. Investors continued to be bearish on Europe and redeemed heavily. Offshore equity ETFs listed globally with investment focus in Asia-Pac received first ever positive monthly flows in July this year, although totalled only +$156mn. However on country and sub-region level, net flow directions were divergent. China and Japan focused ETFs saw major outflows recording - $850mn and -$486mn in redemptions. While broad Asian benchmarked ETFs received notable inflows of +$741mn, followed by Australia (+$443mn). It is worth highlighting that Indonesia focused offshore ETFs attracted inflows in July totalling +$120mn which is 14.5% of last month’s total assets. Asia-Pac listed ETP Flows: Japan and gold ETPs received inflows, outflows from Chinese equity and money market ETFs After amassing +$23.4bn inflows in H1 this year, net flows for Asia listed ETPs turned negative in July totaling -$2.6bn and bringing YTD total to +$20.8bn. Fixed income and equity ETFs saw outflows of -$2.5bn and -$684mn respectively, partially offset by inflows into commodity ETPs (+$474mn). Japan ETFs attracted strong inflows of +$2.6bn while China and Taiwan ETFs recorded outflows of -$1.3bn and -$963mn. Fixed income ETF outflows were driven by China money market ETFs recording outflows of -$2.7bn over the last month. Within commodity, gold ETPs attracted notable inflows of +$435mn which were primarily gathered by China listed gold ETFs. New launches in Asia: International equities, healthcare sector, leveraged/inverse, India and China exposures It was another busy month for Asia-Pac region with 14 new ETFs launch including 12 equity and 2 fixed income ETFs. Equity ETF new launches were around international equities, healthcare sector, leveraged/inverse, India and China exposures. One RQFII ETF was launched in Europe. Distributed on: 08/10/2016 13:38:02GMT
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Deutsche Bank Markets Research
Asia
Synthetic Equity & Index Strategy
Asia-Pac Monthly ETF Insights
Date
10 August 2016
EM and Broad Asia Preferred while Japan and China Saw Outflows
Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1.MCI (P) 057/04/2016.
ETF Annual Review & Outlook - Strong Growth to Continue Despite Volatile Markets
21 Jan 2016
Source: Deutsche Bank
Global ETP assets grow to $3.3 trillion amid rising markets and healthy inflows Global ETP AUM was up by 5% ($157bn) last month and reached $3.3tn (11.3% increase YTD), supported by bullish markets and strong inflows. Asia-Pac listed ETPs closed the month at record high assets of $306bn. ETPs listed globally (ex-RoW) received inflows of +$53.7bn over the last month with US ETPs bringing in largest inflows (+$45.7bn), followed by Europe (+$10.6bn) while Asia-Pac ETPs experienced outflows of -$2.6bn. Global ETP flows reached +$164.5bn in total YTD (5.7% of last year end AUM).
Global investor positioning: Broad EM and DM preferred, Europe continues to retreat, outflows from Japan and China Based on July flows to ETFs listed globally with regional focus, Broad (global) EM have been most favoured receiving major inflows, followed by Broad (global) DM, which was being preferred most during H1 period. Investors continued to be bearish on Europe and redeemed heavily.
Offshore equity ETFs listed globally with investment focus in Asia-Pac received first ever positive monthly flows in July this year, although totalled only +$156mn. However on country and sub-region level, net flow directions were divergent. China and Japan focused ETFs saw major outflows recording -$850mn and -$486mn in redemptions. While broad Asian benchmarked ETFs received notable inflows of +$741mn, followed by Australia (+$443mn). It is worth highlighting that Indonesia focused offshore ETFs attracted inflows in July totalling +$120mn which is 14.5% of last month’s total assets.
Asia-Pac listed ETP Flows: Japan and gold ETPs received inflows, outflows from Chinese equity and money market ETFs After amassing +$23.4bn inflows in H1 this year, net flows for Asia listed ETPs turned negative in July totaling -$2.6bn and bringing YTD total to +$20.8bn. Fixed income and equity ETFs saw outflows of -$2.5bn and -$684mn respectively, partially offset by inflows into commodity ETPs (+$474mn). Japan ETFs attracted strong inflows of +$2.6bn while China and Taiwan ETFs recorded outflows of -$1.3bn and -$963mn. Fixed income ETF outflows were driven by China money market ETFs recording outflows of -$2.7bn over the last month. Within commodity, gold ETPs attracted notable inflows of +$435mn which were primarily gathered by China listed gold ETFs.
New launches in Asia: International equities, healthcare sector, leveraged/inverse, India and China exposures It was another busy month for Asia-Pac region with 14 new ETFs launch including 12 equity and 2 fixed income ETFs. Equity ETF new launches were around international equities, healthcare sector, leveraged/inverse, India and China exposures. One RQFII ETF was launched in Europe.
Distributed on: 08/10/2016 13:38:02GMT
10 August 2016
Asia-Pac Monthly ETF Insights
Page 2 Deutsche Bank AG/Hong Kong
Table of Contents
1. Market and Industry Overview ................................................... 3 Market review: July proves to be bullish across the globe ..................................................... 3 Global ETP assets grow to $3.3 trillion amid rising markets and healthy inflows ................... 4 ETFs vs. Mutual Funds in Asia Pac ......................................................................................... 5
2. Global ETF Investment Trends .................................................... 6 Regional positioning: Broad EM and DM preferred, Europe continue to retreat .................... 6 Global Investor positioning in Asia: Inflows to broad ETFs while outflows from China and
Japan ...................................................................................................................................... 6 China ETF Market Insights: Redemptions in July .................................................................... 8 ETF investment trends in the US and European markets ....................................................... 9
3. Asia-Pac Listed ETF Activity Summary .................................... 10 Japan and gold ETPs received inflows, outflows from Chinese equity and money market
4. Product Insights ......................................................................... 11 New launches – 14 ETFs launched in Asia-Pac, 1 RQFII ETF in Europe................................ 11 Low Volatility ETF momentum continues ............................................................................. 11
5. Performance and Growth .......................................................... 13 Performance and growth for ETFs listed globally with investment focus in Asia-Pac .......... 13 Top ETPs – Asia-Pac listed .................................................................................................... 15 Top ETPs – Other regions with Asia-Pac focus ..................................................................... 18
Appendix B: How we define ETPs ................................................ 51
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 3
1. Market and Industry Overview
Market review: July proves to be bullish across the globe
Post Brexit referendum in June, it was a bullish month across all the major equity markets globally in July. Within Asia-Pac region, equity markets in Japan and Australia witnessed robust return of over 6% on a month-over-month basis. Equity markets in Hong Kong, India, Taiwan and South Korea also saw notable returns. Outside Asia-Pac region, US and European markets also made a comeback with about 3.5% return last month.
Following is the snapshot of major benchmarks’ recent performance:
Benchmarks Jul - 16 (MoM)
Jun - 16 (MoM)
YTD TTM
Japan (Nikkei 225) 6.38% -9.63% -12.95% -19.51%
South Korea (KOSPI2) 3.01% 0.21% 4.62% 2.94%
China (CSI 300) 1.59% -0.49% -14.13% -16.05%
Taiwan (TWSE) 3.67% 1.53% 7.75% 3.68%
Hong Kong (HSI) 5.28% -0.10% -0.11% -11.14%
India (Sensex) 3.90% 1.24% 7.41% -0.22%
Singapore (FSSTI) 0.98% 1.79% -0.49% -10.42%
Australia (S&P/ASX 200) 6.29% -2.70% 5.03% -2.40%
US (S&P 500) 3.56% 0.09% 6.34% 3.32%
Europe (STOXX Europe 600) 3.64% -5.06% -6.54% -13.74% Source: Deutsche Bank, Bloomberg Finance LP
Global ETP assets grow to $3.3 trillion amid rising markets and healthy inflows
Global ETP assets closed the month at $3.3 trillion Global ETP AUM was up by 5% ($157bn) last month and reached $3.3 trillion, supported by bullish markets and strong inflows. On a year-to-date basis global ETP AUM is up by 11.3% ($335.4bn). Asia-Pac listed ETPs closed the month at record high assets of $306bn. ETPs listed globally (ex-RoW) received robust inflows of +$53.7bn over the last month with US ETPs bringing in largest inflows (+$45.7bn), followed by Europe (+$10.6bn) while Asia-Pac ETPs experienced outflows of -$2.6bn. Adding to +$110.8bn inflows collected during H1, global ETP flows total reached +$164.5bn by the end of July. On YTD basis, US ETPs brought in largest inflows (+$110.7bn), followed by Europe (+$32.9bn) and Asia-Pac (+$20.8bn). Amid market headwinds this year, risk-off assets are being preferred which is evident from fixed income (+$81.1bn) and commodity ETP flows (+$29.9bn), restricting equity ETFs at +$52.5bn.
Asia-Pac ETP AUM at a record high level Asia-Pac listed ETP assets closed the month at $306bn, highest on record level. After amassing +$23.4bn inflows in H1 this year, net flows for July turned negative totalling -$2.6bn, primarily because of China equity and money market ETFs.
Figure 3: Global ETP regional asset growth historically
*As of last month except for RoW which is as of 3rd Aug 2016 Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 4: Global flows summary by region Figure 5: Regional flows as a % of AUM
Jul-16 Jun-16 YTD
Asia-Pac (2,592) 634 20,826
Europe 10,600 4,983 32,946
US 45,692 19,620 110,703
(20,000)
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Jul-16 Jun-16 YTD
US 2.0% 0.9% 5.2%
Europe 2.0% 0.9% 6.5%
Asia-Pac -0.9% 0.2% 7.3%
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UM
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 5
ETFs vs. Mutual Funds in Asia Pac
Asia-Pac ETPs comprised 6.5% of the continent’s mutual fund industry as of Q1 2016 according to mutual fund industry data published by the Investment Company Institute (ICI). This has steadily grown from 4.6% at the end of Q1 2014. US ETPs comprised 16.8% while Europe ETPs comprised 3.5% of respective region’s mutual fund industry as of Q1 2016. Within Asia-Pac, Taiwan is on the top with ETP assets accounting for 13.5% of mutual fund assets. Japan ETP assets account for 11.5% of mutual fund assets.
Source: Deutsche Bank, Bloomberg Finance LP, Reuters, ICI
10 August 2016
Asia-Pac Monthly ETF Insights
Page 6 Deutsche Bank AG/Hong Kong
2. Global ETF Investment Trends
Regional positioning: Broad EM and DM preferred, Europe continue to retreat
Based on July flows to ETFs listed globally with regional focus, Broad (global) EM have been most favored receiving major inflows, followed by Broad (global) DM. Unlike what we observed in July, Broad (global) DM was being preferred most during H1 period. Investors continued to be bearish on Europe and redeemed heavily.
Figure 8: Broad market flows movement – Jul 2016* Figure 9: Broad market flows movement – YTD*
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DM - Europe DM - Broad DM - Asia PacEM - Asia Pac Broad - Asia Pac EM - BroadEM - EMEA EM - LATAM
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*These figures includes globally listed broad market focused ETFs from all the segments within equity asset class (i.e. country, regional, sector, size, strategy, style and thematic). Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Global Investor positioning in Asia: Inflows to broad ETFs while outflows from China and Japan
Total assets of equity ETFs listed globally (offshore only) with investment focus in the Asia-Pacific region closed the month at $118.4bn with a MoM increase of 5.4%.
Offshore equity ETFs received first ever positive monthly flows in July this year, although totaled only +$156mn. However, on country and sub-region level, net flow directions were divergent. China and Japan focused ETFs saw major outflows recording -$850mn and -$486mn in redemptions. While broad Asian benchmarked ETFs received notable inflows of +$741mn, followed by Australia (+$443mn). It is worth highlighting that Indonesia focused offshore ETFs attracted inflows in July totaling +$120mn which is 14.5% of last month’s total assets. Indonesia focused ETF assets have grown from half a billion dollar to $1bn this year supported by healthy inflows on YTD basis (+$368mn).
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 7
Figure 10: Offshore equity ETFs listed globally with investment focus in Asia*
Investment Focus Jul-16% of
AUMJun-16 May-16 YTD
% of
AUMJul-16 Jun-16 Dec-15
Emerging Markets
Bangladesh 1 6.7% 1 0 0 1.4% 23 21 22
China -850 -2.8% 611 -1,377 -1,464 -4.2% 30,372 30,321 34,551
India 92 1.0% 23 -208 -208 -2.2% 9,777 9,165 9,479
Indonesia 120 14.5% 81 -92 368 74.4% 999 828 495
Malaysia -2 -0.6% -17 -21 94 34.5% 372 377 272
Pakistan 8 21.6% 5 1 13 46.3% 45 36 28
Philippines 16 3.7% 96 -43 93 30.7% 440 416 302
South Korea -9 -0.2% -121 -306 -314 -7.0% 4,569 4,324 4,500
Total 359 0.7% -1,376 -2,328 -13,104 -17.4% 58,366 54,458 75,300
Asia Broad Indices 108 1.8% -11 -124 -462 -6.9% 6,588 6,183 6,720
Grand Total 156 0.1% -687 -4,683 -14,978 -10.9% 118,395 112,320 137,950
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country, regional, sector, size, strategy, style and thematic). Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 11: Flows by DM country – Jul 2016* Figure 12: Flows by DM country – YTD*
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country, regional, sector, size, strategy, style and thematic). Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Page 8 Deutsche Bank AG/Hong Kong
Figure 13: Flows by EM country – Jul 2016* Figure 14: Flows by EM country – YTD*
-1,000 -800 -600 -400 -200 0 200
China
South Korea
Malaysia
Vietnam
Philippines
Thailand
India
Taiwan
Indonesia
July Flows ($mn)
-2,000 -1,500 -1,000 -500 0 500
China
Taiwan
South Korea
India
Vietnam
Philippines
Malaysia
Thailand
Indonesia
YTD Flows ($mn)
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country, regional, sector, size, strategy, style and thematic). Source: Deutsche Bank, Bloomberg Finance LP, Reuters
China ETF Market Insights: Redemptions in July
China focused offshore equity ETFs recorded net outflows of -$850mn in July. These outflows were attributed to both A-shares and H-shares which each recording over -$400mn worth of redemptions. RQFII equity ETF outflows contribution was about -$300mn among A-share ETFs. On YTD basis, divergence between A-share and H-share ETF flows, especially during H1 period. H-share ETFs saw redemptions of -$2.1bn while A-share ETFs registered inflows of +$558mn on YTD basis. A-share ETF inflows were driven by RQFII equity ETFs collecting +$747mn this year. China focused onshore equity ETFs experienced outflows of -$651mn in July but net inflows of +$1.2bn on YTD basis.
Figure 15: Offshore China ETF Flows – Jul 2016* Figure 16: Offshore China ETF Flows – YTD*
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A-share ETFs H-share & OthersCSI 300 (rhs) MSCI China (rhs)
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A-share ETFs H-share & OthersCSI 300 (rhs) MSCI China (rhs)
* As of 29 Jul 2016 Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 9
ETF investment trends in the US and European markets
Europe: EM Equity and Debt ETFs Benefit in July Europe domiciled ETPs registered strong inflows of +€9.6bn across all major asset classes (equity, fixed income and commodity). Fixed Income ETFs lead with inflows of +€4.9bn followed by Commodity ETPs (+€2.5bn) and Equity ETFs (+€2.1bn).
Global EM and S&P 500 exposed ETFs benefitted from inflows: Investors trading Europe listed ETPs were net buyers of Global Emerging Markets (+€1.2bn) focused ETFs. US focused ETFs listed in Europe also benefitted in July with monthly inflows of +€0.8bn (+€2.4bn YTD flows). ETFs tracking broad European indices experienced net outflows of -€1.7bn in July (-€9bn so far this year). Countrywise, Germany-focused ETFs suffered redemptions of -€0.4bn (YTD -€1.9bn). Robust inflows into Low volatility products, Dividend ETFs also benefit: Smart beta ETFs continued their positive run and registered +€1.8bn worth of new money in July, taking YTD inflows above +€6bn. Low volatility remains popular amongst investors where we observed inflows into a variety of Low Vol products which includes exposure to Europe, Global and US equities. Dividend ETFs also benefitted where two products in particular saw healthy inflows (SPDR S&P US Dividend Aristocrats and SPDR S&P Euro Dividend Aristocrats). EM Bond ETFs dominates within the Sovereign bond category: Both Corporate and Sovereign bond ETFs contributed significantly to the overall Fixed Income flows, attracting +€2.6bn and +€2.3bn respectively. Interestingly, Emerging Markets bond ETFs were popular taking up the top 3 ranks by net inflows into the Fixed Income asset class. Gold ETPs continue to draw investment: Commodity ETPs flows remained strong during the month of July with inflows of +€2.5bn (YTD +€9.4bn). This was primarily driven by inflows into Gold ETPs (+€1.5bn). Gold ETPs have now registered net inflows of +€7.3bn this year while Equities ETFs are in negative territory (-€0.7bn YTD flows).
US: Inflows across all asset classes US-domiciled ETPs recorded strong inflows of +$45.7bn in July (+$19.6bn in Jun’16) taking YTD flows to +$110.7bn. Equities attracted +$32.7bn in new money, followed by fixed income (+$10.8bn). On YTD basis, fixed income ETFs took the lead with +$60.5bn inflows while equity and commodity ETPs recorded inflows of +$31.3bn and +$18.2bn respectively.
EM preference continues: After receiving notable inflows in June, broad EM ETFs once again received strong inflows totaling +$6.2bn in July. These ETFs recovered from experiencing outflows in the previous months in 2016 taking YTD flows total to +$10.1bn. Seeking yield: During last month, ETFs tracking high dividend yielding stocks received notable inflows of +$3.5bn (+$12.2bn YTD). This suggests that investors are looking for yield in low interest rate scenario. Low Vol and Real Estate attracted inflows: Investors continue to allocate assets into low vol ETFs to manage volatility which resulted into +$2.6bn worth of new money into these ETFs. US Real Estate ETFs also attracted net inflows of +$1.2bn over the last month. Redemptions from Europe and Japan: Europe continued to experience significant and consistent outflows in July (-$5.3bn), suggesting that negative sentiment towards the region hasn’t tapered, despite the relief rally following the Brexit vote. Also Japan focused ETFs saw redemptions totaling -$587mn last month. IG corporate and EM bond ETFs benefitted: US based IG corporate bond ETFs received inflows of +$2.9bn in July followed by EM bond ETFs which attracted +$1.8bn.
10 August 2016
Asia-Pac Monthly ETF Insights
Page 10 Deutsche Bank AG/Hong Kong
3. Asia-Pac Listed ETF Activity Summary
Japan and gold ETPs received inflows, outflows from Chinese equity and money market ETFs
After amassing +$23.4bn inflows in H1 this year, net flows for Asia-Pac listed ETPs turned negative in July totalling -$2.6bn and bringing YTD total to +$20.8bn. Fixed income and equity ETFs saw outflows of -$2.5bn and -$684mn respectively, partially offset by inflows into commodity ETPs (+$474mn).
Within equity, Japan-focused ETFs attracted strong inflows of +$2.6bn while China and Taiwan-focused ETFs recorded outflows of -$1.3bn and -$963mn. Further, leveraged/inverse ETFs saw -$1bn worth of redemptions in July.
Fixed income ETF outflows were driven by China money market ETFs recording outflows -$2.7bn over the last month. Within commodity, gold ETPs attracted notable inflows of +$435mn which were primarily gathered by China listed gold ETFs.
Figure 17: Major flow activity by country – Jul 2016 Figure 18: Major flow activity by country – YTD
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*Includes Asia listed equity and fixed income ETFs by investment focus country Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Wins and losses: At ETP level, largest inflows were received by Nikko Exchange Traded Index 225 (1330 JP), Yuanta/P-shares Taiwan Top 50 1X Bear ETF (00632R TT) and Samsung KODEX Inverse ETF (114800 KS) collecting +$688mn, +$655mn and +$635mn respectively. Largest redemptions were experienced by Next Funds Nikkei 225 Leveraged Index ETF (1570 JP), Yuanta/P-Shares Taiwan Top 50 ETF (0050 TT) and Fortune SGAM Xianjin Tianyi Money Market (511990 CH) with outflows of -$1.8bn, -$963mn and -$854mn respectively.
Turnover: Floor activity down by 15.3% in July Asia-Pac listed ETP turnover activity was down by 15.3% in July and totaled $164.6bn. On a country level, stock exchanges in China topped the turnover ranking with aggregate turnover of $85.1bn, followed by Japan ($49.6bn), South Korea ($14.5bn) and Hong Kong ($8.8bn).
At ETP level, Next Funds Nikkei 225 Leveraged Index ETF (1570 JP), Fortune SGAM Xianjin Tianyi Money Market (511990 CH) and Yinhua Traded Money Market Fund (511880 CH) were the most traded products of the month recording total turnovers of $31.5bn, $21.7bn and $17.1bn respectively.
AUM: Assets closed the month at $306bn Asia-Pac listed ETP assets closed the month at a record high level of $306bn with 2.6% or $7.9bn increase on MoM basis. On year-to-date basis assets are up by 7.8% or 22.1bn.
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 11
4. Product Insights
New launches – 14 ETFs launched in Asia-Pac, 1 RQFII ETF in Europe
Asia-Pac listings: Issuance around international equities, healthcare sector, leveraged/inverse, India and China exposures It was another busy month for Asia-Pac region with 14 new ETFs launch including 12 equity and 2 fixed income ETFs. Mirae Asset MAPS Global Investments launched 4 equity ETFs on Korea Stock Exchange. These ETFs track US large caps, Eurozone high dividend yielding stocks, global healthcare sector and Japanese healthcare sector respectively. Cathay Securities Investment Trust listed 2 equity ETFs on Taiwan Stock Exchange providing leveraged long and inverse exposure, respectively, to broad Taiwanese equity market. Remaining 6 equity ETFs were launched by various ETF providers with exposures around Indian large caps, Indian mid caps, Vietnam, Eurozone large caps, Chinese growth stocks and global gold miners with currency hedging respectively. Reliance Capital Asset Management listed one ETF on National Stock Exchange (India) tracking long duration Indian government bonds. China Merchants Fund Management Company launched one money market ETF on Shanghai Stock Exchange.
Europe – RQFII ETF launch Wisdom Tree launched one RQFII equity ETF on London Stock Exchange tracking S&P China 500 Index. This was the eighth RQFII ETF launch in Europe.
Figure 19: New Launches in July
ETP Name BBG IssuerAsset Class
& StructureExchange TER
Asia-Pac
Mirae Asset Tiger Dow Jones 30 ETF 245340 KS Mirae Asset MAPS Global Investments Equity ETF Korea SE - KSE 0.35%
Mirae Asset Tiger Euro Stoxx Dividend 30 ETF 245350 KS Mirae Asset MAPS Global Investments Equity ETF Korea SE - KSE 0.35%
Mirae Asset Tiger Synth-Global Healthcare ETF 248270 KS Mirae Asset MAPS Global Investments Equity ETF Korea SE - KSE 0.40%
Mirae Asset Tiger Synth-Japan Healthcare ETF 248260 KS Mirae Asset MAPS Global Investments Equity ETF Korea SE - KSE 0.40%
ICICI Prudential Midcap Select ETF ICPMIDC IN Prudential ICICI Asset Management Equity ETF India - NSE na
KIM KINDEX Vietnam VN30 ETF Synth 245710 KS Korea Investment Trust Mg Equity ETF Korea SE - KSE 0.70%
ANZ ETFS Euro Stoxx 50 ETF ESTX AU ANZ Asset Management Equity ETF Australia - ASX 0.35%
Birla Sun Life Sensex ETF BSLSENX IN Birla Sun Life Asset Management Co Equity ETF India - Bombay na
Huaan ChiNext 50 ETF Fund 159949 CH Huaan Fund Management Equity ETF China - Shenzhen na
Betashares Global Gold Miners ETF-Currency Hedged MNRS AU BetaShares Capital Ltd Equity ETF Australia - ASX 0.57%
China Merchants Caifubao Traded Money Market Fund 511850 CH China Merchants Fund Management Co Fixed Income ETF China - Shanghai na
R*Shares Long Term Gilt ETF RELGILT IN Reliance Capital Asset Management Fixed Income ETF India - NSE na
Europe
ICBCCS WisdomTree S&P China 500 UCITS ETF CHIN LN WisdomTree Equity ETF London SE - LSE 0.75% * Europe listing is for Asia-Pac focus ETFs only Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Low Volatility ETF momentum continues
Low volatility ETFs track equities with lower volatility characteristics relative to the broader market. These ETFs may help to reduce losses during declining markets while still experiencing gains during rising markets. So, low volatility ETFs tend to attract attention when the volatility rises.
10 August 2016
Asia-Pac Monthly ETF Insights
Page 12 Deutsche Bank AG/Hong Kong
This is evident since start of the year and especially in July these ETFs registered inflows of +$3.9bn taking YTD total to +$21.4bn globally amid high volatility period. On exchange trading activity also risen recording average monthly turnover of about $10.7bn this year which is more than two times of 2015 monthly average. Total assets of low volatility ETFs have reached to $54.8bn at the end of July which is just under double of the 2015 ending level of $28.9bn.
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 13
5. Performance and Growth
Performance and growth for ETFs listed globally with investment focus in Asia-Pac
ETF Performance - Winners and losers Singapore-listed ETF tracking MSCI India index was the top performing ETF of the month while one ETF tracking S&P 500 VIX Short-term Futures Index was the least performer of the month, followed by crude oil based ETPs amid sharp fall in oil prices.
Figure 21: Top 10 best performance
ETF Name Bloomberg Underlying Index 29-Jul-16 30-Jun-16 31-May-16 YTD
iShares MSCI India ETF INDIA SP MSCI India 11.4% 1.0% 2.4% 15.2%
China Universal CSI Consumer Staples Index ETF 159928 CH CSI Consumer Staples Index 9.0% 3.6% 3.0% 2.9%
iShares Asia Pacific Dividend UCITS ETF IAPD LN DJ Asia Pacific Select Dividend 9.0% 10.7% -2.1% 31.6%
iShares MSCI Australia UCITS ETF SAUS LN MSCI Australia 8.1% 10.3% -1.7% 23.3%
iShares MSCI New Zealand Capped ETF ENZL US MSCI New Zealand IMI 25/50 8.1% 2.5% 0.4% 24.1%
iShares Dow Jones Asia Pacific Select Dividend 30 (DE) APSDEX GR DJ Asia Pacific Select Dividend 8.0% 1.9% 0.1% 14.7%
Yuanta/P-Shares PS Taiwan Dividend Plus ETF 0056 TT Taiwan Dividend Index 7.8% 3.0% 1.6% 11.5%
GS CPSE BeES CPSEBE IN CPSE Index 7.7% 4.7% -1.1% 4.9%
db x-trackers S&P/ASX 200 UCITS ETF (DR) XAUS GR S&P/ASX 200 7.7% 1.1% 0.9% 3.5%
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, Long only, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 22: Top 3 ETFs by performance in Jul – Daily performance -YTD
-30%
-20%
-10%
0%
10%
20%
30%
40%
Daily P
erf
orm
an
ce
INDIA SP 159928 CH IAPD LN
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, Long only, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
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Figure 23: Top 10 least performance
ETF Name Bloomberg Underlying Index 29-Jul-16 30-Jun-16 31-May-16 YTD
Kokusai S&P500 VIX Short Term Futures Index ETF 1552 JP S&P 500 VIX Short-Term Futures Index -25.1% -2.9% -13.3% -53.2%
Next Funds NOMURA Crude Oil 1699 JP Nomura Crude Oil Long Index -17.0% -9.3% 10.5% -23.8%
Yuanta/P-Shares CSI 300 Fund 0061 TT CSI 300 Index -1.7% -0.5% 0.2% -13.8%
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, Long only, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 24: Bottom 3 ETFs by performance in Jul – Daily performance - YTD
-60%
-40%
-20%
0%
20%
40%
60%
Daily P
erf
orm
an
ce
1552 JP 1699 JP 1671 JP
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, Long only, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
ETP flow growth - Winners and losers One Chinese money market ETF led the table as largest fund flow receiver as a percentage of AUM during last month, whereas another Chinese money market ETF saw the largest outflows as a percentage of AUM during last month.
Figure 25: Top 10 Inflows as a % of AUM
ETF Name Bloomberg Underlying Index % of AUMCashflows
($mn)
AUM
($mn)
% of
AUM
Cashflows
($mn)
% of
AUM
Cashflow
s ($mn)
% of
AUM
Cashflow
s ($mn)
Harvest Institution Express Money Market Fund 511960 CH Other 278.5% 419.3 571.1 -41.4% -106.8 -6.0% -16.7 0.0% 572.6
Next Funds Nikkei 225 Double Inverse Index ETF 1357 JP Nikkei 225 Double Inverse Index 100.5% 429.1 803.1 -40.1% -196.8 -18.1% -123.2 120.2% 364.1
iShares MSCI Australia UCITS ETF SAUS LN MSCI Australia 81.2% 435.5 1,021.0 -2.5% -13.7 -30.3% -250.8 44.1% 293.3
UBS ETF - MSCI Japan 100% hedged to EUR UCITS ETF A-acc JPEUBH SW MSCI Japan 100% hedged to EUR 44.4% 65.9 224.9 0.0% 0.0 -2.6% (4.3) -18.7% -60.3
Jul-16 Jun-16 May-16 YTD
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 15
Figure 26: Top 10 outflows as a % of AUM
ETF Name Bloomberg Underlying Index % of AUMCashflows
($mn)
AUM
($mn)
% of
AUM
Cashflows
($mn)
% of
AUM
Cashflow
s ($mn)
% of
AUM
Cashflow
s ($mn)
Invesco Great Wall Traded Money Market Fund 511890 CH Other -62.2% (224.7) 135.2 83.9% 165.7 -13.2% (30.6) -64.0% (256.3)
Zhongrong Daily Earning Transactional Money Market Fund 511930 CH Other -61.7% (269.1) 165.3 313.5% 333.3 39.8% 30.7 -19.8% (42.6)
Daiwa ETF Japan Nikkei 225 Inverse Index 1456 JP Nikkei 225 Inverse Index -55.7% (215.0) 169.4 534.3% 295.6 -14.2% (10.0) -83.6% (408.9)
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, AUM >$100mn as of previous month Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Tracker Fund of Hong Kong State Street 2800 HK Equity ETF 0.15% (150.1)
Harvest Shanghai and Shenzhen 300 Index ETF Harvest Fund Management Co 159919 CH Equity ETF 0.50% (143.6) Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 31: Top 20 ETPs by Monthly Turnover (US$ Million)
ETP Name Issuer BBG TickerAsset Class
& StructureTER
Turnover
US$ MM
Next Funds Nikkei 225 Leveraged Index ETF Nomura Asset Management 1570 JP Equity ETF 0.87% 31,478.4
Fortune SGAM Xianjin Tianyi Money Market Fortune SGAM Fund Management 511990 CH Fixed Income ETF 0.35% 21,732.4
Yinhua Traded Money Market Fund Yinhua Fund Management 511880 CH Fixed Income ETF 0.30% 17,136.9
Fullgoal Shouyibao Exchange Traded Money Market Fund Fullgoal Fund Management Co 511900 CH Fixed Income ETF 0.00% 7,633.6
China Southern Cash Management Money Market Fund ETF China Southern Fund Management Co Ltd 511810 CH Fixed Income ETF 0.30% 7,407.4
China Universal Tianfutong Money Market Fund China Universal Asset Management Co 511980 CH Fixed Income ETF 0.00% 6,346.5
Next Funds Nikkei 225 Double Inverse Index ETF Nomura Asset Management 1357 JP Equity ETF 0.87% 6,309.9
Penghua Profit Added Traded Money Market Fund Penghua Fund Management Co Ltd 511820 CH Fixed Income ETF 0.00% 4,891.4
Tracker Fund of Hong Kong State Street 2800 HK Equity ETF 0.15% 3,797.6
Zhongrong Daily Earning Transactional Money Market Fund Zhongrong Fund Management Co Ltd 511930 CH Fixed Income ETF 0.61% (415.1) Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Top ETPs – Other regions with Asia-Pac focus
Figure 33: Top 20 ETPs by AUM (US$ Million)
ETP Name Issuer BBG TickerAsset Class &
StructureTER
AUM
US$ MM
iShares MSCI Japan ETF BlackRock EWJ US Equity ETF 0.48% 13,967.5
WisdomTree Japan Hedged Equity Fund WisdomTree DXJ US Equity ETF 0.48% 7,751.5
iShares MSCI India ETF BlackRock INDA US Equity ETF 0.68% 3,990.8
iShares China Large-Cap ETF BlackRock FXI US Equity ETF 0.73% 3,586.5
iShares MSCI South Korea Capped ETF BlackRock EWY US Equity ETF 0.62% 3,387.1
China Universal Asset Management Co (11) (413) - - (423) 1,564
Hang Seng Investment Management (384) - - - (384) 249
Penghua Fund Management Co Ltd (1) (374) - - (375) 35
Nomura Asset Management (312) - 6 - (306) 6,750
KB Asset Management (233) (44) - 0 (278) 161
CSOP Asset Management (231) (53) 8 - (276) 596
Huatai-PineBridge Fund Management Co (256) (15) - - (271) (181)
Total Top 10 (Outflows) (1,891) (2,488) 114 0 (4,264) 6,990
Current Month outflows (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 25
Turnover
Turnover information
Monthly Turnover definition: The turnover figure reported in this publication corresponds to the aggregated dollar value traded turnover (in US$) over a 1 month span. It is calculated by multiplying the on exchange daily volume in shares by the end of day price for the ETP, for each day within a certain month, after which the daily turnover is aggregated for all the days within the month generating the total monthly turnover figure.
Note on Turnover The liquidity of an ETF is not fully captured by its exchange turnover as exchange turnover does not reflect over-the-counter (OTC) trades or trades done at net asset value (NAV). The presence of a market marker is mandatory in most exchanges. The market marker is legally obliged to provide continuous price quotes for an ETF even when the ETF is not being actively traded.
Figure 49: ETP Turnover (US$ Million) by Issuer – Top 40
Total ( All Local Issuers) 84,227 76,992 2,829 510 164,558 100.0%
Current Month Turnover (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Page 28 Deutsche Bank AG/Hong Kong
AUM
AUM information
Assets Under Management (AUM): Calculated as NAV times Number of Shares Outstanding or Price times Number of Shares Outstanding.
AUM Universe The Assets Under Management (AUM) of the ETFs that have been cross-listed in Asia is not taken in account in this report. Please refer to Figure 55 for a detail of Foreign Issuer's AUMs
Figure 52: ETP AUM (US$ Million) ranking by Local Issuer – Top 40
Figure 67: ETP Net Flows (US$ Million) by Index Provider – Commodity
(100) - 100 200 300 400 500
Other
UBS
Commodity
IISL
HSIL
Net Cashflow (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 37
Underlying Index/Security
Figure 68: ETP inflows (US$ Million) by Underlying Index
– Equity (Top 10)
Figure 69: ETP outflows (US$ Million) by Underlying
Index – Equity (Top 10)
- 500 1,000 1,500 2,000
JPX Nikkei Index 400
Nikkei Average Double …
TSE REIT Index
JPX/S&P Capex & Human …
MSCI Japan Human and …
Nikkei 225 Double Inverse Index
Taiwan Top 50 Index
F-KOSPI200 Index
TOPIX
Nikkei 225
Inflow (US$ Million)
(2,500) (2,000) (1,500) (1,000) (500) -
S&P/ASX 200
TOPIX Leveraged (2x) Index
Nikkei 225 Inverse Index
Hang Seng Index
FTSE China A50 Index
Hang Seng China Enterprise Index
CSI 300 Index
KOSPI 200 Index
TSEC Taiwan 50 Index
Nikkei 225 Leveraged Index
Outflow (US$ Million)
Figure 70: ETP inflows (US$ Million) by Underlying Index
– Fixed Income (Top 10)
Figure 71: ETP outflows (US$ Million) by Underlying
Index – Fixed Income
- 100 200 300 400
S&P/ASX Australian Fixed Interest …
UBS Government Inflation Index
MK Korea Monetary Stabilization …
KAP Short-Term Bond Index
iBoxx ABF Malaysia Bond Index
Bloomberg AusBond Composite …
iBoxx ABF Singapore Bond Index
iBoxx ABF Hong Kong Index
30 day Bank Bill Swap Rate
iBoxx ABF Pan-Asia Index
Inflow (US$ Million)
-3000 -2500 -2000 -1500 -1000 -500 0
KIS MSB Short Term Index
MaeKyung Money Market TR Index
KAP Money Market Index
KIS MSB 5M Index
China Bond 5-year Treasurey Bond Index
KIS MSB 3M Index
KRW Cash Index TR
KRW Cash Plus Index
China PBOC Benchmark Notice Deposit 7 Day
Other
Outflow (US$ Million)
Figure 72: ETP inflows (US$ Million) by Underlying
Index/Security – Commodity
Figure 73: ETP outflows (US$ Million) by Underlying
Index/Security – Commodity
0 100 200 300 400 500
S&P GSCI Agriculture
Enhanced Select Index
S&P GSCI Gold Excess Return
Index
S&P GSCI Crude Oil Enhanced
Index
Nomura Crude Oil Long Index
BofA merril Lynch Commodity
Index eXtra CLA Index
S&P GSCI Crude Oil Excess
Reurn Index
Commodity Gold
Inflow (US$ Million)
-6 -5 -4 -3 -2 -1 0
Nikkei-TOCOM Platinum Index
S&P GSCI North American Copper Index TR
S&P GSCI Sliver TR Index
S&P GSCI Crude Oil Index
UBS Bloomberg Constant Maturity Commodity
Index
S&P GSCI Gold Index
Outflow (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Page 38 Deutsche Bank AG/Hong Kong
8. ETP – Turnover
Turnover information
Monthly Turnover definition: The turnover figure reported in this publication corresponds to the aggregated dollar value traded turnover (in US$) over a 1 month span. It is calculated by multiplying the on exchange daily volume in shares by the end of day price for the ETP, for each day within a certain month, after which the daily turnover is aggregated for all the days within the month generating the total monthly turnover figure.
Note on Turnover The liquidity of an ETF is not fully captured by its exchange turnover as exchange turnover does not reflect over-the-counter (OTC) trades or trades done at net asset value (NAV). The presence of a market marker is mandatory in most exchanges. The market marker is legally obliged to provide continuous price quotes for an ETF even when the ETF is not being actively traded.
Figure 85: ETP Monthly Turnover (US$ Million) by Index
Provider – Commodity
Figure 86: ETP Monthly Turnover (US$ Million) by
Underlying Index/Security – Commodity (Top 10)
- 500 1,000 1,500 2,000 2,500
Reuters/Jefferies
Reuters/Jefferies
Nikkei
UBS
Other
S&P Dow Jones
Commodity
Turnover (US$ Million)
- 400 800 1,200 1,600 2,000 2,400 2,800
S&P WCI Gold Excess Return Index
S&P GSCI Gold Index
S&P GSCI Gold Excess Return Index
Commodity Platinum
Commodity Silver
S&P GSCI Crude Oil Enhanced Index
UBS Bloomberg Constant Maturity …
Nomura Crude Oil Long Index
S&P GSCI Crude Oil Excess Reurn Index
Commodity Gold
Turnover (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Page 44 Deutsche Bank AG/Hong Kong
9. ETP – Assets under Management
AUM information
Assets Under Management (AUM): Calculated as NAV times Number of Shares Outstanding or Price times Number of Shares Outstanding.
AUM Universe The Assets Under Management (AUM) of the ETFs that have been cross-listed in Asia is not taken in account in this report. Please refer to Figure 55 for a detail of Foreign Issuer's AUMs.
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
10 August 2016
Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 49
The authors of this report wish to acknowledge the contribution made by Vibhor
Mahalwala and Varun Sachdeva, employees of Evalueserve, a third party provider to
Deutsche Bank of offshore research support services.
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Page 50 Deutsche Bank AG/Hong Kong
Appendix A: Glossary
ETF Glossary
Term Definition
Cross Listing A Cross Listing is an additional listing of a previously existing ETF on a trading venue different from the ETF’s Primary Listing Exchange. A Cross Listing is a symbol of the number of investment options available in the local market.
Primary Listing ETFs may trade on multiple exchanges but they always have one primary exchange. The listing on the primary exchange is referred as the primary listing, which usually corresponds also to the first/oldest listing. A primary listing offers access to a new product which was not available for trading before. The number of primary listings is a symbol of the distinct investment options available across different markets.
TER Total Expense Ratio or TER is the overall cost borne by a fund’s share holder for a 1 year ownership period. It usually includes the management fee and other expenses paid by the fund. TER is, in general, expressed as a percentage of the amount invested and it is proportionally discounted according to the actual holding period.
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Asia-Pac Monthly ETF Insights
Deutsche Bank AG/Hong Kong Page 51
Appendix B: How we define ETPs Exchange-Traded Products (ETPs)
We define an exchange-traded product (ETP) as a secure (funded or collateralized) open-ended delta-one exchange-
traded equity or debt instrument with no embedded optionality and market-wide appeal to investors. This includes
exchange traded funds, exchange-traded commodities (Europe) and exchange-traded vehicles (US).
The figure below provides a summary of our current coverage universe by region and structure type as on 31 December
2014.
The vast majority of instruments are ETFs (97%, 3,906 products, $2,641bn) with the remainder being ETCs (0.7%, 451
products, $20.4bn) in Europe and ETVs (2.1%, 70 products, $56.7bn) in the US.
Figure 99: ETP Coverage Universe Summary
Region Products US$ Mil. % Products US$ Mil. % Products US$ Mil. %
US 1,450 1,979,179 72.7% 1,380 1,922,462 70.6% 70 56,717 2.1%
Europe 1,869 459,225 16.9% 1,418 438,870 16.1% 451 20,355 0.7%
Global 4,447 2,721,220 100.0% 3,906 2,640,532 97.0% 541 80,691 3.0%
ETPs ETFs ETC/Vs
Source: Deutsche Bank, Bloomberg Finance LP, Reuters.
Exchange-Traded Funds (ETFs, 97%)
US (71%): Fund structures that issue shares that are traded on an exchange much the same way as equities. ETFs
indexed to equity and fixed income benchmarks are registered under the investment company act of 1940. Only
physical index replication techniques are permissible by this legislation while synthetic replication is not allowed.
Europe (16%): Fund structures that issue units or shares that are traded on an exchange much the same way as
equities. The vast majorities of European ETFs are UCITS III compliant and are primarily domiciled in Dublin and
Luxemburg. The Undertakings for Collective Investment in Transferable Securities (UCITS) are a set of European Union
directives that aim to allow collective investment schemes to operate freely throughout the EU on the basis of a single
authorization from one member state. Both physical and synthetic index replication is permissible by UCITS and funds
are allowed to track equity, fixed income as well as diversified commodity indices.
Asia (7%): Both European and US ETFs are cross sold into the Asian market.
Exchange-Traded Collateralized Instruments (3%)
Exchange-Traded Commodities (ETCs, 1%)
In Europe as UCITS III does not permit the creation of funds tracking non diversified commodity indices (for example
wheat or oil), exchange-traded products that track single commodity profiles are issued under the EU Prospectus
Directive in two structures that have become widely known as exchange-traded commodities (ETCs). ETCs can either
be physically backed or they can be issued through a bankruptcy remote special purpose vehicle (SPV). Both forms
utilize offshore domiciles, such as Jersey, and are classed as debt instruments. Physically-backed ETCs are fully backed
with securities that closely resemble the composition of a product’s benchmark index. SPV structures are collateralized
by assets which could bear no resemblance to those of their respective benchmark index and ensure replication of their
index return through a total return swap structure or by holding other derivative instruments such as futures. In the vast
majority of cases, both types of ETCs are fully collateralized with secure assets such as money market instruments,
government bonds and gold. For more information, please refer to our research report issued on March 11 2010 titled
‘The race for assets in the European Exchange-Traded Products Market”.
Exchange-traded vehicles (ETVs, 2%)
This terminology typically refers to grantor trusts that exist in the US market. These instruments track primarily
commodity benchmarks. They differ from ETFs in that they are registered under the Securities Act of 1933 and not the
investment Company Act of 1940, hence they are not classed as funds. Vehicles that replicate commodity benchmarks,
more often known as pools, and funds targeting alternative index returns are formed under the Commodities Exchange
Act and are listed under the 33 Securities Act, and report under 34 Corporate Act.
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Appendix 1
Important Disclosures
Additional information available upon request
*Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced from local exchanges via Reuters, Bloomberg and other vendors . Other information is sourced from Deutsche Bank, subject companies, and other sources. For disclosures pertaining to recommendations or estimates made on securities other than the primary subject of this research, please see the most recently published company report or visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr
Analyst Certification
The views expressed in this report accurately reflect the personal views of the undersigned lead analyst(s). In addition, the undersigned lead analyst(s) has not and will not receive any compensation for providing a specific recommendation or view in this report. Shan Lan
Equity rating key Equity rating dispersion and banking relationships
Buy: Based on a current 12- month view of total share-holder return (TSR = percentage change in share price from current price to projected target price plus pro-jected dividend yield ) , we recommend that investors buy the stock.
Sell: Based on a current 12-month view of total share-holder return, we recommend that investors sell the stock
Hold: We take a neutral view on the stock 12-months out and, based on this time horizon, do not recommend either a Buy or Sell.
Newly issued research recommendations and target prices supersede previously published research.