Asia Synthetic Equity & Index Strategy ETF Monthly Asia Date 13 July 2017 Deutsche Bank Markets Research First monthly outflow in 2017 Data in this report is as of 30 th June 2017 Asia listed ETP Monthly Highlights (Assets & Flows): ■ Assets: ETP AUM up by $2.8bn on MoM basis and ended the month at $372bn. ■ Flows: June saw the first monthly net outflows in 2017 of -$0.6bn (YTD +$25.1bn). New Product Launches – 9 new products, fixed income ETFs dominate Asia-Pac ETP market recorded 9 new launches which include 1 equity, 6 fixed income and 2 commodity ETFs. New launches were primarily around Korean equities, US treasuries, Australian bonds, crude oil and grains. Investment Themes for the Month ■ Equity ETFs attracted +$1.8bn in June (+$407mn in May). Primary contributors were Japan focused ETFs registering inflows of +$2.3bn driven by Bank of Japan purchases. ■ South Korea, Taiwan and Hong Kong focused ETFs were other beneficiaries in June collecting inflows of +$414mn, +$388mn and + $287mn respectively. ■ Leveraged/inverse (-$1.1bn) and China (-$628mn) focused ETFs saw redemptions in June. ■ Fixed income ETFs witnessed outflows of -$2.9bn, primarily from China money market ETFs (-$3.3bn). ■ Non Asia listed Equity ETFs with investment focus in the Asia-Pacific region drew +$2.6bn driven also by Japan focused ETFs (+$1.5bn). Turnover: MoM turnover increased by 12.6% The total turnover activity into Asian ETPs increased by 12.6% ($187.7bn) compared to the previous month’s total ($166.8bn). Ari Rajendra Research Analyst +44-20-754-52282 Sebastian Mercado, CFA Strategist +1-212-250-8690 Deutsche Bank AG/London 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) 083/04/2017. Distributed on: 13/07/2017 11:18:09 GMT 0bed7b6cf11c
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Investment Themes for the Month ETF Monthly Asia Asia ... · Leveraged/inverse (-$1.1bn) and China (-$628mn) focused ETFs saw redemptions in June. Fixed income ETFs witnessed outflows
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13 July 2017
ETF Monthly Asia
Asia Synthetic Equity & Index Strategy
ETF Monthly AsiaDate13 July 2017
Deutsche BankMarkets Research
First monthly outflow in 2017
Data in this report is as of 30th June 2017
Asia listed ETP Monthly Highlights (Assets & Flows):■ Assets: ETP AUM up by $2.8bn on MoM basis and ended the month at
$372bn.
■ Flows: June saw the first monthly net outflows in 2017 of -$0.6bn (YTD+$25.1bn).
New Product Launches – 9 new products, fixed income ETFs dominateAsia-Pac ETP market recorded 9 new launches which include 1 equity, 6 fixedincome and 2 commodity ETFs. New launches were primarily around Koreanequities, US treasuries, Australian bonds, crude oil and grains.
Investment Themes for the Month■ Equity ETFs attracted +$1.8bn in June (+$407mn in May). Primary
contributors were Japan focused ETFs registering inflows of +$2.3bndriven by Bank of Japan purchases.
■ South Korea, Taiwan and Hong Kong focused ETFs were otherbeneficiaries in June collecting inflows of +$414mn, +$388mn and +$287mn respectively.
■ Leveraged/inverse (-$1.1bn) and China (-$628mn) focused ETFs sawredemptions in June.
■ Fixed income ETFs witnessed outflows of -$2.9bn, primarily from Chinamoney market ETFs (-$3.3bn).
■ Non Asia listed Equity ETFs with investment focus in the Asia-Pacificregion drew +$2.6bn driven also by Japan focused ETFs (+$1.5bn).
Turnover: MoM turnover increased by 12.6%The total turnover activity into Asian ETPs increased by 12.6% ($187.7bn)compared to the previous month’s total ($166.8bn).
Ari Rajendra
Research Analyst
+44-20-754-52282
Sebastian Mercado, CFA
Strategist
+1-212-250-8690
Deutsche Bank AG/London
Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should beaware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should considerthis report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONSARE LOCATED IN APPENDIX 1.MCI (P) 083/04/2017.
1. Market Overview .......................................................... 3Market review: Most major Asian markets saw positive returns in J ............. 3
2. Asia-Pac Listed ETF Activity Summary ........................ 4Japan equities accumulates inflows while China money markets saw ........... 4
3. Product Insights ........................................................... 6New launches – 9 new ETFs in Asia .............................................................. 6
4. Global ETP Industry Overview and Investment Tre........................................................................................... 7Global ETP AUM above $4 trillion with over $56bn monthly inflows .............. 7Regional positioning: Broad DM, Europe and EM preferred ........................... 8Global Investor positioning in Asia: Inflow to Japan, outflow fro ................... 8ETFs vs. Mutual Funds in Asia Pac .............................................................. 10
5. Performance and Growth ........................................... 11Performance and growth for Asia-Pac focused ETFs listed globally ............. 11Top ETPs – Asia-Pac listed ........................................................................... 13Top ETPs – Other regions with Asia-Pac focus ............................................. 16
Appendix B: How we define ETPs ................................. 56
Page 2 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
1. Market OverviewMarket review: Most major Asian markets saw positivereturns in June
Many of the equity markets globally continued to record positive returns on amonth-over-month basis. During June, within Asia-Pac region, China, Taiwan andSouth Korea were the best performers. Broad global emerging markets and broadAsia-Pac market return were also positive over the last month. Outside Asia-Pacregion, US witnessed positive returns however Europe retreated sharply.
On a YTD basis, all the major markets ended in positive territory at the end ofJune. Emerging markets were strongly positive posting double digit growth sofar, especially Korea, Hong Kong, India, broad global emerging markets and broadAsia-Pac. US and European markets returned below 10% but were positive.
Following is the snapshot of major benchmarks’ recent performance:
Figure 1: Major Benchmark Performance
Japan (Nikkei 225) 1.95% 2.36% 4.81% 28.62%
South Korea (KOSPI2) 2.33% 6.08% 19.90% 27.70%
China (CSI 300) 4.98% 1.54% 10.78% 16.26%
Taiwan (TWSE) 3.53% 1.71% 12.34% 19.94%
Hong Kong (HSI) 0.41% 4.25% 17.11% 23.90%
India (Sensex) -0.72% 4.10% 16.13% 14.53%
Singapore (FSSTI) 0.49% 1.11% 12.00% 13.57%
Australia (S&P/ASX 200) -0.05% -3.37% 0.98% 9.33%
US (S&P 500) 0.48% 1.16% 8.24% 15.46%
Europe (STOXX Europe 600) -2.72% 0.75% 4.97% 15.00%
Asia-Pac (MSCI AC Asia Pacific - MXAP) 1.25% 2.56% 14.48% 19.93%
EM (MSCI Emerging Markets - MXEF) 0.54% 2.80% 17.23% 21.18%
BenchmarksJun - 17
(MoM)
May - 17
(MoM)YTD TTM
Source: Deutsche Bank, Bloomberg Finance LP
Figure 2: Jun-17 (MoM) benchmark performance
97
98
99
100
101
102
103
104
105
106
Ind
ex L
evels
Reb
ased
(1
00
)
CSI 300
TWSE
KOSPI2
Nikkei 225
FSSTI
S&P 500
HSI
S&P/ASX 200
Sensex
STOXX Europe
600
CSI 300
STOXX Europe
Source: Deutsche Bank, Bloomberg Finance LP
Figure 3: YTD benchmark performance
95
100
105
110
115
120
125
Ind
ex L
evels
Reb
ased
(1
00
)
KOSPI2
HSI
Sensex
TWSE
FSSTI
CSI 300
S&P 500
STOXX Europe
600
Nikkei 225
S&P/ASX 200
KOSPI2
S&P/ASX 200
Source: Deutsche Bank, Bloomberg Finance LP
Deutsche Bank AG/London Page 3
13 July 2017
ETF Monthly Asia
2. Asia-Pac Listed ETFActivity SummaryJapan equities accumulates inflows while China moneymarkets saw redemptions
Asia-Pac listed ETPs recorded first monthly outflows in June this year totalling -$0.6bn bringing YTD flows total to +$25.1bn. After receiving mild inflows in May(+$407mn), equity ETF flows picked up in June bringing in +$1.8bn in new money.However, it was offset by fixed income ETF outflows of -$2.9bn over the lastmonth.
Equity ETF inflows in June were primarily contributed by Japan focused ETFsregistering inflows of +$2.3bn. Moreover, Japan focused ETF YTD inflows (+$28.6bn), driven by Bank of Japan purchases, dominated entire equity ETF flowsin H1 (+$26.8bn). Apart from Japan, South Korea, Taiwan and Hong Kong focusedETFs also benefited in June recording inflows of +$414mn, +$388mn and +$287mn respectively. These were partially offset by leveraged/inverse (-$1.1bn)and China (-$628mn) focused ETFs.
In the region, fixed income ETF flows have been dominated by China moneymarket ETFs. Unlike previous months when these ETFs posted strong inflows, inJune China money market ETFs experienced -$3.3bn worth of redemptions amidbullish equity markets.
Figure 4: Major flow activity by country – Jun 2017
(6) (5) (4) (3) (2) (1) - 1 2 3 4
Cu
mu
lati
ve N
et
Flo
ws ($
bn
)
Japan South Korea China Taiwan
India Hong Kong Australia
*Includes Asia listed equity and fixed income ETFs by investment focus country
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 5: Major flow activity by country – YTD
(10)
(5)
-
5
10
15
20
25
30
35
Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17
Cu
mu
lati
ve N
et
Flo
ws ($
bn
)
Japan China Hong Kong Taiwan
South Korea Australia India
*Includes Asia listed equity and fixed income ETFs by investment focus countrySource: Deutsche Bank, Bloomberg Finance LP, Reuters
Wins and losses: At ETP level, TOPIX ETF (1306 JP), Nomura Nikkei 225 ETF (1321JP) and Nikko Exchange Traded Index 225 (1330 JP) collecting +$1.2bn, +$1bnand +$866mn respectively. Largest redemptions were experienced by YinhuaTraded Money Market Fund (511880 CH), Fortune SGAM Xianjin Tianyi MoneyMarket (511990 CH) and Maxis Nikkei 225 ETF (1346 JP) with outflows of -$1.4bn,-$1.3bn and -$953mn, respectively.
Turnover: Floor activity up by 12.6% in JuneAsia-Pac-listed ETP turnover was up by 12.6% and totaled $187.7bn for themonth of June. On a country level, stock exchanges in China topped the turnover
Page 4 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
ranking with aggregate turnover of $118.1bn, followed by Japan ($26.5bn), Korea($19.2bn) and Hong Kong ($15.9bn).
At ETP level, Fortune SGAM Xianjin Tianyi Money Market (511990 CH), YinhuaTraded Money Market Fund (511880 CH) and Next Funds Nikkei 225 LeveragedIndex ETF (1570 JP) were the most traded products of the month recording totalturnovers of $42.9bn, $27.4bn and $17.4bn, respectively.
AUM: Assets close the month at $372bnAsia-Pac-listed ETP AUM increased marginally in June and closed the month at$372.1bn with 0.8% or $2.8bn rise on MoM basis. On a year-to-date basis assetsare up 18.3% or $57.6bn above last year levels.
Deutsche Bank AG/London Page 5
13 July 2017
ETF Monthly Asia
3. Product InsightsNew launches – 9 new ETFs in Asia
Asia-Pac listings: 9 new ETFs launched around Korean equities, US treasuries,Australian money market and floating rate bonds, crude oil and grainsDuring June 2017, Asia-Pac ETP market recorded 9 new launches which include1 equity, 6 fixed income and 2 commodity ETFs.
The only equity ETF was launched by KB Asset Management on Korea StockExchange tracking KOSDAQ 150 Index.
Yuanta Securities listed three fixed income ETFs on Taiwan Stock Exchange.One of these ETFs provides long only exposure to US treasuries while other twoprovide leveraged long and inverse exposures respectively to US treasuries.
BlackRock listed two Australian money market ETFs on Australian SecuritiesExchange.
BetaShares launched a fixed income ETFs on Australian Securities Exchangetracking the performance of Australian floating rate bonds.
Samsung Asset Management launched two commodity ETFs on Korea StockExchange. One of these ETFs is providing inverse exposure to crude oil priceswhile the other one is focusing on grains.
Figure 6: New Launches in June
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Page 6 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
4. Global ETP IndustryOverview and InvestmentTrendsGlobal ETP AUM above $4 trillion with over $56bn monthlyinflows
Global ETP AUM maintained above $4 trillion level and closed the month at$4.13 trillion. ETP AUM witnessed a 1.6% ($63.1bn) month-on-month rise and17.6% ($619bn) year-on-year rise, supported by strong inflows. ETP AUM growthachieved during H1 2017 (17.6%) is very significant and it is almost equal tothe full year AUM growth in 2016 (17.9%). Asia-Pac listed ETP assets closed themonth at of $372.1bn.
Inflows for ETPs listed globally (ex-RoW) stood stronger than last month andreceived about +$56bn in June taking YTD total to +$331.3bn. Inflows weredominated by US ETPs bringing in +$46.9bn in new money, followed by EuropeETPs attracting +$9.8bn. Asia ETPs experienced outflows recording -$0.6bnworth of redemptions. On asset class level, equity and fixed income drove theinflows contributing +$37.8bn and +$15.6bn inflows respectively over the lastmonth.
Figure 7: Global ETP regional asset growth historically
*As of last month except for RoW which is as of 7 Jul 2017
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Deutsche Bank AG/London Page 7
13 July 2017
ETF Monthly Asia
Figure 8: Global flows summary by region
Jun-17 May-17 YTD (Monthly
Avg)
Asia-Pac (597) 2,847 4,176
Europe 9,786 12,111 10,282
US 46,889 30,758 40,763
(10,000)
-
10,000
20,000
30,000
40,000
50,000
Net
Flo
ws ($
mn
)
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 9: Regional flows as a % of AUM
Jun-17 May-17 YTD (Monthly
Avg)
Asia-Pac -0.2% 0.8% 1.3%
Europe 1.4% 1.9% 1.8%
US 1.6% 1.1% 1.6%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
Net
Flo
ws a
s a
% o
f A
UM
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Regional positioning: Broad DM, Europe and EM preferred
Based on June flows to ETFs listed globally with regional focus, Broad (global)DM have been most favored receiving major inflows, followed by DM Europe andBroad (global) EM. This has been the trend throughout this year so far.
Figure 10: Broad market flows movement – Jun 2017*
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
Cu
mu
lati
ve F
low
s ($
bn
)
DM - Europe DM - Broad DM - Asia Pac EM - Asia Pac Broad - Asia Pac EM - Broad EM - EMEA EM - LATAM
*These figures includes globally listed broad market focused ETFs from all the segments within equityasset class (i.e. country, regional, sector, size, strategy, style and thematic).
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 11: Broad market flows movement – YTD*
(10)
-
10
20
30
40
50
Cu
mu
lati
ve F
low
s ($
bn
)
DM - Europe DM - Broad DM - Asia Pac EM - Asia Pac Broad - Asia Pac EM - Broad EM - EMEA EM - LATAM
*These figures includes globally listed broad market focused ETFs from all the segments within equityasset class (i.e. country, regional, sector, size, strategy, style and thematic).Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Global Investor positioning in Asia: Inflow to Japan,outflow from China
Total assets of equity ETFs listed globally (offshore only) with investment focusin the Asia-Pacific region closed the month at $138.8bn, 3.3% above previousmonth's level.
These ETFs recorded healthy inflows of +$2.6bn in June which is the biggestmonthly inflow this year. Inflows were lead by Japan focused ETFs attracting+$1.5bn in new money followed by South Korea (+$479mn) and Australia (+$322mn) focused ETFs. In addition, DM (broad) Asia also received major inflowsrecording +$332 mn worth of new creations. On the contrary, China focused ETFsshed -$238mn as outflows. On YTD basis, Japan (+$2.3bn) and India (+$1bn)were the top flow receivers while China (-$1.7bn) saw the most redemptions.
Page 8 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
Figure 12: Offshore equity ETFs listed globally with investment focus in Asia*
Investment Focus Jun-17% of
AUMMay-17 Apr-17 YTD
% of
AUMJun-17 May-17 Dec-16
Emerging Markets
Bangladesh -1 -4.5% -1 0 -2 -6.7% 26 26 25
China -238 -0.8% -276 36 -1,743 -6.1% 31,181 30,658 28,476
India 62 0.5% 138 263 951 11.0% 11,467 11,530 8,667
Indonesia -19 -2.3% -31 50 -14 -2.0% 814 823 739
Malaysia 2 0.5% 48 27 156 52.5% 496 499 297
Pakistan -2 -3.0% 3 3 26 53.3% 69 78 48
Philippines -10 -3.7% 3 20 25 12.2% 252 267 203
South Korea 479 10.1% 153 -208 344 8.8% 5,192 4,729 3,897
Taiwan 10 0.2% 77 50 299 9.2% 4,228 4,067 3,243
Thailand -18 -3.9% -23 -4 -12 -2.8% 450 470 427
Vietnam 5 0.9% -16 -6 -28 -5.4% 553 531 518
EM Asia Broad 120 3.8% 130 90 604 27.9% 3,319 3,149 2,170
Total 389 0.7% 204 321 607 1.2% 58,045 56,828 48,710
Developed Markets
Australia 322 11.1% -83 -59 -366 -10.8% 3,258 2,894 3,379
Hong Kong -176 -6.4% 23 13 -288 -12.0% 2,550 2,741 2,410
Japan 1,466 2.9% 200 -83 2,341 5.1% 52,725 50,557 46,353
Total 1,951 2.8% 502 112 3,593 5.7% 72,156 69,317 62,531
Asia Broad Indices 296 3.6% 258 340 1,081 17.5% 8,602 8,196 6,160
Grand Total 2,637 2.0% 964 772 5,280 4.5% 138,803 134,341 117,402
Net Flows ($ million) AUM ($ million)
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country, regional, sector, size, strategy, style andthematic).
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 13: Flows by DM country – Jun 2017*
-500 0 500 1,000 1,500
Hong Kong
Singapore
New Zealand
Australia
Japan
Monthly Flows ($mn)
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country,regional, sector, size, strategy, style and thematic).
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 14: Flows by DM country – YTD*
-500 0 500 1,000 1,500 2,000 2,500
Australia
Hong Kong
Singapore
New Zealand
Japan
YTD Flows ($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
Deutsche Bank AG/London Page 9
13 July 2017
ETF Monthly Asia
Figure 15: Flows by EM country – Jun 2017*
-300 -200 -100 0 100 200 300 400 500 600
China
Indonesia
Thailand
Philippines
Malaysia
Vietnam
Taiwan
India
South Korea
Monthly Flows ($mn)
*This figure includes ETFs (offshore only) from all the segments within equity asset class (i.e. country,regional, sector, size, strategy, style and thematic).
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Figure 16: Flows by EM country – YTD
-2,000 -1,500 -1,000 -500 0 500 1,000
China
Vietnam
Indonesia
Thailand
Philippines
Malaysia
Taiwan
South Korea
India
YTD Flows ($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
ETFs vs. Mutual Funds in Asia Pac
Asia-Pac ETPs comprised 7% of the continent’s mutual fund industry as ofQ1 2017 according to mutual fund industry data published by the InvestmentCompany Institute (ICI). This has steadily grown from 4.6% at the end of Q12014. US ETPs comprised 19.6% while Europe ETPs comprised 4% of respectiveregion’s mutual fund industry as of Q1 2017. Within Asia-Pac, Taiwan is on the topwith ETP assets accounting for 17.5% of mutual fund assets, followed by JapanETP assets accounting for 15.2% of mutual fund assets.
Source: Source: Deutsche Bank, Bloomberg Finance LP, Reuters, ICI
Page 10 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
5. Performance andGrowthPerformance and growth for Asia-Pac focused ETFs listedglobally
ETF Performance - Outperformers and underperformersTop performing ETFs of the month were dominated by China focused ETFs whilean ETF tracking large cap Indian equities via CPSE Index was the worst performerof the month.
Figure 19: Top 10 best performance
ETF Name Bloomberg Underlying Index 30-Jun-17 31-May-17 28-Apr-17 YTD
Mirae Asset MAPS Tiger China Consumer ETF 150460 KS FnGuide China Consumer Index -4.4% 7.3% 3.5% 10.8%
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 22: Bottom 3 ETFs by performance in Jun - Daily performance YTD
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17
Daily P
erf
orm
an
ce
CPSEBE IN 1596 JP 1699 JP
Universe: All Asia-Pac listed ETPs + US & Europe listed ETPs with investment focus in Asia-Pacific, Long only, AUM >$100mn as of previousmonth
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
ETP flow growth - Winners and losersAn ETF tracking Chinese money market led the table as largest fund flow receiveras a percentage of AUM during last month, whereas an ETF tracking JPX/S&PCapex & Human Capital Index saw the largest outflows as a percentage of AUMover the same period.
Page 12 Deutsche Bank AG/London
13 July 2017
ETF Monthly Asia
Figure 23: Top 10 Inflows as a % of AUM
ETF Name Bloomberg Underlying Index % of AUMCashflows
($mn)
AUM
($mn)
% of
AUM
Cashflows
($mn)
% of
AUM
Cashflow
s ($mn)
% of
AUM
Cashflow
s ($mn)
China AMC Express Traded Money Market Fund 511650 CH Other 251.7% 369.0 516.3 -33.4% -72.6 -6.3% -14.5 0.0% 511.6
Yuanta S&P GSCI Crude Oil 2X Leveraged ER Futures ETF 00672L TT S&P GSCI Crude Oil 2X Leveraged Index ER 160.2% 264.8 421.7 29.3% 37.3 -24.2% -41.5 314.4% 332.3
KraneShares Bosera MSCI China A ETF KBA US MSCI China A 73.4% 82.9 206.3 81.9% 49.5 30.5% 14.3 687.5% 168.1
Bank of China Investment Management 3 - - - 3 0.00%
TMB Asset Management 2 - - - 2 0.00%
Canara Robeco - - 2 - 2 0.00%
Edelweiss Asset Management 1 - - - 1 0.00%
Mizuho Asset Management Co Ltd - - 1 - 1 0.00%
Total ( All Local Issuers) 327,494 38,300 5,211 1,057 372,062 100%
Current Month AUM (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP.
The Foreign Issuer AUM ranking includesthe AUM of all products cross listed in theAsia-Pacific Region, with a domicile regionoutside Asia-Pacific (e.g. the US or Europe).
Figure 53: ETP AUM (US$ Million) ranking by Foreign Issuer
Issuer EquityFixed
IncomeCommodity Total
Mkt
Share %
BlackRock 315,673 9,137 - - 324,810 41.0%
State Street 269,205 3,940 34,037 - 307,183 38.8%
Vanguard 102,233 714 - - 102,947 13.0%
Deutsche AM 26,830 2,743 - - 29,573 3.7%
ETF Securities - - 10,322 - 10,322 1.3%
Lyxor 8,286 - 1,898 - 10,184 1.3%
UBS 7,029 - - - 7,029 0.9%
ComStage 109 - - - 109 0.0%
BNP Paribas 15 - 93 - 108 0.0%
Total ( All Foreign Issuers) 729,381 16,535 46,350 - 792,265 100%
Current Month AUM (US$ Million)
Source: Deutsche Bank, Bloomberg Finance LP.
Deutsche Bank AG/London Page 29
13 July 2017
ETF Monthly Asia
7. ETP - Net FlowsInvestment Focus
Figure 54: ETP Net Flows (US$ Million) by Investment Focus – Equity
Investment Focus - EquityNet
Cashflow
% of
AUM
Net
Cashflow
% of
AUM
Net
Cashflow
% of
AUM
Developed Markets 2,766 1.2% 570 0.3% 28,541 15.7%
The authors of this report wish to acknowledge the contribution made byVibhor Mahalwala and Varun Sachdeva, employees of Evalueserve, a third partyprovider to Deutsche Bank of offshore research support services.
Page 54 Deutsche Bank AG/London
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ETF Monthly Asia
Appendix A: Glossary
Deutsche Bank AG/London Page 55
13 July 2017
ETF Monthly Asia
Appendix B: How wedefine 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 noembedded optionality and market-wide appeal to investors. This includesexchange traded funds, exchange-traded commodities (Europe) and exchange-traded vehicles (US).
The figure below provides a summary of our current coverage universe by regionand structure type as on 30 December 2016.
The vast majority of instruments are ETFs (97.4%, 4,779 products, $3,422bn) withthe remainder being ETCs (0.8%, 474 products, $26.5bn) in Europe and ETVs(1.8%, 64 products, $61.7bn) in the US.
Figure 97: ETP Coverage Universe Summary
Source: Deutsche Bank, Bloomberg Finance LP, Reuters
Exchange-Traded Funds (ETFs, 97.4%)US (70.4%): Fund structures that issue shares that are traded on an exchangemuch the same way as equities. ETFs indexed to equity and fixed incomebenchmarks are registered under the investment company act of 1940. Onlyphysical index replication techniques are permissible by this legislation whilesynthetic replication is not allowed.
Europe (15.5%): Fund structures that issue units or shares that are traded on anexchange much the same way as equities. The vast majorities of European ETFsare UCITS III compliant and are primarily domiciled in Dublin and Luxemburg. TheUndertakings for Collective Investment in Transferable Securities (UCITS) are aset of European Union directives that aim to allow collective investment schemesto operate freely throughout the EU on the basis of a single authorization fromone member state. Both physical and synthetic index replication is permissible byUCITS and funds are allowed to track equity, fixed income as well as diversifiedcommodity indices.
Asia (8.9%): Both European and US ETFs are cross sold into the Asian market.
Exchange-Traded Collateralized Instruments (2.6%)
Exchange-Traded Commodities (ETCs, 0.8%)
Page 56 Deutsche Bank AG/London
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ETF Monthly Asia
In Europe as UCITS III does not permit the creation of funds tracking nondiversified commodity indices (for example wheat or oil), exchange-tradedproducts that track single commodity profiles are issued under the EU ProspectusDirective in two structures that have become widely known as exchange-tradedcommodities (ETCs). ETCs can either be physically backed or they can beissued through a bankruptcy remote special purpose vehicle (SPV). Both formsutilize offshore domiciles, such as Jersey, and are classed as debt instruments.Physically-backed ETCs are fully backed with securities that closely resemble thecomposition of a product’s benchmark index. SPV structures are collateralized byassets which could bear no resemblance to those of their respective benchmarkindex and ensure replication of their index return through a total return swapstructure or by holding other derivative instruments such as futures. In the vastmajority of cases, both types of ETCs are fully collateralized with secure assetssuch as money market instruments, government bonds and gold. For moreinformation, 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, 1.8%)This terminology typically refers to grantor trusts that exist in the US market.These instruments track primarily commodity benchmarks. They differ fromETFs in that they are registered under the Securities Act of 1933 and not theinvestment Company Act of 1940, hence they are not classed as funds. Vehiclesthat replicate commodity benchmarks, more often known as pools, and fundstargeting alternative index returns are formed under the Commodities ExchangeAct and are listed under the 33 Securities Act, and report under 34 Corporate Act.
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Appendix 1
Important Disclosures
*Other information available upon request
*Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced fromlocal exchanges via Reuters, Bloomberg, and other vendors. Other information is sourced from Deutsche Bank, subjectcompanies, and other sources. For disclosures pertaining to recommendations or estimates made on securities other thanthe primary subject of this research, please see the most recently published company report or visit our global disclosurelook-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr. Aside from within this report,important conflict disclosures can also be found at https://gm/db.com/equities under the "Disclosures Lookup" and "Legal"tabs. Investors are strongly encouraged to review this information before investing.
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 recommendationor view in this report. Ari Rajendra, Sebastian Mercado
Hypothetical Disclaimer
Backtested, hypothetical or simulated performance results have inherent limitations. Unlike an actual performancerecord based on trading actual client portfolios, simulated results are achieved by means of the retroactive applicationof a backtested model itself designed with the benefit of hindsight. Taking into account historical events the backtestingof performance also differs from actual account performance because an actual investment strategy may be adjustedany time, for any reason, including a response to material, economic or market factors. The backtested performanceincludes hypothetical results that do not reflect the reinvestment of dividends and other earnings or the deduction ofadvisory fees, brokerage or other commissions, and any other expenses that a client would have paid or actually paid.No representation is made that any trading strategy or account will or is likely to achieve profits or losses similar tothose shown. Alternative modeling techniques or assumptions might produce significantly different results and prove tobe more appropriate. Past hypothetical backtest results are neither an indicator nor guarantee of future returns. Actualresults will vary, perhaps materially, from the analysis.
Equity Rating Key Equity rating dispersion and banking relationships
Buy: Based on a current 12- month view of total share-holderreturn (TSR = percentage change in share price from currentprice 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-holderreturn, 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 Buyor Sell.
Newly issued research recommendations and target pricessupersede previously published research.
1.Additional InformationInformation on ETFs is provided strictly for illustrative purposes and should not be deemed an offer to sell or asolicitation of an offer to buy shares of any fund that is described in this document. Consider carefully any fund'sinvestment objectives, risk factors, and charges and expenses before investing. This and other information can be foundin the fund's prospectus. Prospectuses about db X-trackers funds and Powershares DB funds can be obtained by calling1-877-369-4617 or by visiting www.DBXUS.com. Read prospectuses carefully before investing. Past performance is notnecessarily indicative of future results. Investing involves risk, including possible loss of principal. To better understandthe similarities and differences between investments, including investment objectives, risks, fees and expenses, it isimportant to read the products' prospectuses. Shares of ETFs may be sold throughout the day on an exchange throughany brokerage account. However, shares may only be redeemed directly from an ETF by authorized participants, in verylarge creation/redemption units. Transactions in shares of ETFs will result in brokerage commissions and will generatetax consequences. ETFs are obliged to distribute portfolio gains to shareholders. Deutsche Bank may be an issuer,advisor, manager, distributor or administrator of, or provide other services to, an ETF included in this report, for which itreceives compensation. db X-trackers and Powershares DB funds are distributed by ALPS Distributors, Inc. The opinionsexpressed are those of the authors and do not necessarily reflect the views of DB, ALPS or their affiliates.
Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the"Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review this information before investing.
?The information and opinions in this report were prepared by Deutsche Bank AG or one of its affiliates (collectively"Deutsche Bank"). Though the information herein is believed to be reliable and has been obtained from public sourcesbelieved to be reliable, Deutsche Bank makes no representation as to its accuracy or completeness. Hyperlinks to third-party websites in this report are provided for reader convenience only. Deutsche Bank neither endorses the content noris responsible for the accuracy or security controls of these websites.
If you use the services of Deutsche Bank in connection with a purchase or sale of a security that is discussed in this report,or is included or discussed in another communication (oral or written) from a Deutsche Bank analyst, Deutsche Bank mayact as principal for its own account or as agent for another person.
Deutsche Bank may consider this report in deciding to trade as principal. It may also engage in transactions, for itsown account or with customers, in a manner inconsistent with the views taken in this research report. Others withinDeutsche Bank, including strategists, sales staff and other analysts, may take views that are inconsistent with those takenin this research report. Deutsche Bank issues a variety of research products, including fundamental analysis, equity-linkedanalysis, quantitative analysis and trade ideas. Recommendations contained in one type of communication may differfrom recommendations contained in others, whether as a result of differing time horizons, methodologies or otherwise.Deutsche Bank and/or its affiliates may also be holding debt or equity securities of the issuers it writes on. Analysts arepaid in part based on the profitability of Deutsche Bank AG and its affiliates, which includes investment banking, tradingand principal trading revenues.
Opinions, estimates and projections constitute the current judgment of the author as of the date of this report. They donot necessarily reflect the opinions of Deutsche Bank and are subject to change without notice. Deutsche Bank providesliquidity for buyers and sellers of securities issued by the companies it covers. Deutsche Bank research analysts sometimeshave shorter-term trade ideas that are consistent or inconsistent with Deutsche Bank's existing longer term ratings. Tradeideas for equities can be found at the SOLAR link at http://gm.db.com. A SOLAR idea represents a high conviction beliefby an analyst that a stock will outperform or underperform the market and/or sector delineated over a time frame of noless than two weeks. In addition to SOLAR ideas, the analysts named in this report may from time to time discuss withour clients, Deutsche Bank salespersons and Deutsche Bank traders, trading strategies or ideas that reference catalystsor events that may have a near-term or medium-term impact on the market price of the securities discussed in this report,which impact may be directionally counter to the analysts' current 12-month view of total return or investment return asdescribed herein. Deutsche Bank has no obligation to update, modify or amend this report or to otherwise notify a recipientthereof if any opinion, forecast or estimate contained herein changes or subsequently becomes inaccurate. Coverage andthe frequency of changes in market conditions and in both general and company specific economic prospects make itdifficult to update research at defined intervals. Updates are at the sole discretion of the coverage analyst concerned or ofthe Research Department Management and as such the majority of reports are published at irregular intervals. This reportis provided for informational purposes only and does not take into account the particular investment objectives, financialsituations, or needs of individual clients. It is not an offer or a solicitation of an offer to buy or sell any financial instrumentsor to participate in any particular trading strategy. Target prices are inherently imprecise and a product of the analyst’sjudgment. The financial instruments discussed in this report may not be suitable for all investors and investors must maketheir own informed investment decisions. Prices and availability of financial instruments are subject to change withoutnotice and investment transactions can lead to losses as a result of price fluctuations and other factors. If a financialinstrument is denominated in a currency other than an investor's currency, a change in exchange rates may adverselyaffect the investment. Past performance is not necessarily indicative of future results. Unless otherwise indicated, pricesare current as of the end of the previous trading session, and are sourced from local exchanges via Reuters, Bloombergand other vendors. Data is sourced from Deutsche Bank, subject companies, and in some cases, other parties.
The Deutsche Bank Research Department is independent of other business areas divisions of the Bank. Details regardingour organizational arrangements and information barriers we have to prevent and avoid conflicts of interest with respectto our research is available on our website under Disclaimer found on the Legal tab.??Macroeconomic fluctuations often account for most of the risks associated with exposures to instruments that promiseto pay fixed or variable interest rates. For an investor who is long fixed rate instruments (thus receiving these cash flows),
increases in interest rates naturally lift the discount factors applied to the expected cash flows and thus cause a loss.The longer the maturity of a certain cash flow and the higher the move in the discount factor, the higher will be theloss. Upside surprises in inflation, fiscal funding needs, and FX depreciation rates are among the most common adversemacroeconomic shocks to receivers. But counterparty exposure, issuer creditworthiness, client segmentation, regulation(including changes in assets holding limits for different types of investors), changes in tax policies, currency convertibility(which may constrain currency conversion, repatriation of profits and/or the liquidation of positions), and settlement issuesrelated to local clearing houses are also important risk factors to be considered. The sensitivity of fixed income instrumentsto macroeconomic shocks may be mitigated by indexing the contracted cash flows to inflation, to FX depreciation, or tospecified interest rates – these are common in emerging markets. It is important to note that the index fixings may -- byconstruction -- lag or mis-measure the actual move in the underlying variables they are intended to track. The choice of theproper fixing (or metric) is particularly important in swaps markets, where floating coupon rates (i.e., coupons indexed toa typically short-dated interest rate reference index) are exchanged for fixed coupons. It is also important to acknowledgethat funding in a currency that differs from the currency in which coupons are denominated carries FX risk. Naturally,options on swaps (swaptions) also bear the risks typical to options in addition to the risks related to rates movements.??Derivative transactions involve numerous risks including, among others, market, counterparty default and illiquidity risk.The appropriateness or otherwise of these products for use by investors is dependent on the investors' own circumstancesincluding their tax position, their regulatory environment and the nature of their other assets and liabilities, and as such,investors should take expert legal and financial advice before entering into any transaction similar to or inspired by thecontents of this publication. The risk of loss in futures trading and options, foreign or domestic, can be substantial. As aresult of the high degree of leverage obtainable in futures and options trading, losses may be incurred that are greaterthan the amount of funds initially deposited. Trading in options involves risk and is not suitable for all investors. Priorto buying or selling an option investors must review the "Characteristics and Risks of Standardized Options”, at http://www.optionsclearing.com/about/publications/character-risks.jsp. If you are unable to access the website please contactyour Deutsche Bank representative for a copy of this important document.?
Participants in foreign exchange transactions may incur risks arising from several factors, including the following: ( i)exchange rates can be volatile and are subject to large fluctuations; ( ii) the value of currencies may be affected bynumerous market factors, including world and national economic, political and regulatory events, events in equity anddebt markets and changes in interest rates; and (iii) currencies may be subject to devaluation or government imposedexchange controls which could affect the value of the currency. Investors in securities such as ADRs, whose values areaffected by the currency of an underlying security, effectively assume currency risk.?
Unless governing law provides otherwise, all transactions should be executed through the Deutsche Bank entity in theinvestor's home jurisdiction. Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the "Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review thisinformation before investing.
Deutsche Bank (which includes Deutsche Bank AG, its branches and all affiliated companies) is not acting as a financialadviser, consultant or fiduciary to you, any of your agents (collectively, "You" or "Your") with respect to any informationprovided in the materials attached hereto. Deutsche Bank does not provide investment, legal, tax or accounting advice,Deutsche Bank is not acting as Your impartial adviser, and does not express any opinion or recommendation whatsoeveras to any strategies, products or any other information presented in the materials. Information contained herein is beingprovided solely on the basis that the recipient will make an independent assessment of the merits of any investmentdecision, and it does not constitute a recommendation of, or express an opinion on, any product or service or any tradingstrategy.
The information presented is general in nature and is not directed to retirement accounts or any specific person or accounttype, and is therefore provided to You on the express basis that it is not advice, and You may not rely upon it in makingYour decision. The information we provide is being directed only to persons we believe to be financially sophisticated,who are capable of evaluating investment risks independently, both in general and with regard to particular transactionsand investment strategies, and who understand that Deutsche Bank has financial interests in the offering of its productsand services. If this is not the case, or if You are an IRA or other retail investor receiving this directly from us, we askthat you inform us immediately.
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United Kingdom: Approved and/or distributed by Deutsche Bank AG acting through its London Branch at WinchesterHouse, 1 Great Winchester Street, London EC2N 2DB. Deutsche Bank AG in the United Kingdom is authorised by thePrudential Regulation Authority and is subject to limited regulation by the Prudential Regulation Authority and FinancialConduct Authority. Details about the extent of our authorisation and regulation are available on request.??Hong Kong: Distributed by Deutsche Bank AG, Hong Kong Branch or Deutsche Securities Asia Limited.??India: Prepared by Deutsche Equities India Pvt Ltd, which is registered by the Securities and Exchange Board of India (SEBI)as a stock broker. Research Analyst SEBI Registration Number is INH000001741. DEIPL may have received administrativewarnings from the SEBI for breaches of Indian regulations.
Japan: Approved and/or distributed by Deutsche Securities Inc.(DSI). Registration number - Registered as a financialinstruments dealer by the Head of the Kanto Local Finance Bureau (Kinsho) No. 117. Member of associations: JSDA, TypeII Financial Instruments Firms Association and The Financial Futures Association of Japan. Commissions and risks involvedin stock transactions - for stock transactions, we charge stock commissions and consumption tax by multiplying thetransaction amount by the commission rate agreed with each customer. Stock transactions can lead to losses as a resultof share price fluctuations and other factors. Transactions in foreign stocks can lead to additional losses stemming fromforeign exchange fluctuations. We may also charge commissions and fees for certain categories of investment advice,products and services. Recommended investment strategies, products and services carry the risk of losses to principaland other losses as a result of changes in market and/or economic trends, and/or fluctuations in market value. Beforedeciding on the purchase of financial products and/or services, customers should carefully read the relevant disclosures,prospectuses and other documentation. "Moody's", "Standard & Poor's", and "Fitch" mentioned in this report are notregistered credit rating agencies in Japan unless Japan or "Nippon" is specifically designated in the name of the entity.Reports on Japanese listed companies not written by analysts of DSI are written by Deutsche Bank Group's analysts withthe coverage companies specified by DSI. Some of the foreign securities stated on this report are not disclosed accordingto the Financial Instruments and Exchange Law of Japan. Target prices set by Deutsche Bank's equity analysts are basedon a 12-month forecast period.
Korea: Distributed by Deutsche Securities Korea Co.?
South Africa: Deutsche Bank AG Johannesburg is incorporated in the Federal Republic of Germany (Branch RegisterNumber in South Africa: 1998/003298/10).??Singapore: by Deutsche Bank AG, Singapore Branch or Deutsche Securities Asia Limited, Singapore Branch (One RafflesQuay #18-00 South Tower Singapore 048583, +65 6423 8001), which may be contacted in respect of any matters arisingfrom, or in connection with, this report. Where this report is issued or promulgated in Singapore to a person who is not anaccredited investor, expert investor or institutional investor (as defined in the applicable Singapore laws and regulations),they accept legal responsibility to such person for its contents.
Taiwan: Information on securities/investments that trade in Taiwan is for your reference only. Readers shouldindependently evaluate investment risks and are solely responsible for their investment decisions. Deutsche Bank researchmay not be distributed to the Taiwan public media or quoted or used by the Taiwan public media without written consent.Information on securities/instruments that do not trade in Taiwan is for informational purposes only and is not to beconstrued as a recommendation to trade in such securities/instruments. Deutsche Securities Asia Limited, Taipei Branchmay not execute transactions for clients in these securities/instruments.??
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