db X-trackers is introducing a new range of 'direct replication' ETFs, the intention being to offer investors 'replication choice' in key equity markets, such as the US, Germany, Japan, the UK and the Eurozone. In practice, this means that for certain markets db X-trackers will offer both a direct replication and an indirect replication ETF.
There has been much debate and discussion surrounding the merits of direct replication versus indirect replication of indices. We recognise the fact that some people may be more comfortable investing in products that do not use derivatives for primary portfolio management purposes.
Replication choice aims to ensure that the needs of all investors can be met. Not only will investors be able to come to db X-trackers and express their preference for the type of market risk and reward they wish to take, but will also be able to invest in line with their preference for how the ETF operates and achieves its index replication, for certain markets.