DWS expands range of Xtrackers bond market ETFs
- Xtrackers Green Bond ETF offers access to government bonds that meet criteria for "green" bonds
- Another new ETF allows investment in inflation-indexed bonds denominated in US dollars
- ETF focusing on the Eurozone Government bond market weights bonds based on the ESG score of the respective countries
DWS has expanded its range of Xtrackers ETFs with three products on bond markets that are currently of interest to investors. The Xtrackers II Eurozone Government Green Bond UCITS ETF 1D ESG offers access to the growing segment of "green" government bonds. Here, the issuers are committed to using the capital collected through the issue to finance sustainable projects - such as environmental and climate protection[1]. Last year, DWS had already launched two Xtrackers ETFs that invest in "green" corporate bonds denominated in Euros and US dollars. The new ETF invests in "green" government bonds in the Eurozone. This market is growing strongly as public budgets play an important role in financing the sustainable transformation of energy networks and infrastructure. The Xtrackers II Eurozone Government Green Bond UCITS ETF 1D ESG reports under Article 9 of the Sustainable Finance Disclosure Regulation (SFDR).
The Xtrackers II TIPS US Inflation-Linked Bond UCITS ETF 1C also represents an expansion of the ETF range. DWS already offers ETFs that provide exposure to Global and Eurozone inflation-linked bonds . The new ETF gives investors access to the US market for inflation-indexed bonds. Inflation-indexed bonds pay a variable interest rate linked to realised inflation. The bond's principal repayment can also vary depending on inflation trends.
The Xtrackers II Eurozone Government Bond ESG Tilted UCITS ETF 1D ESG Screened complements the existing range of Xtrackers Government Bond ETFs that promote ESG characteristics. While traditional indices base their country weighting on the volume of government bonds issued, the index underlying the new ETF uses a different approach: those countries with a better score for environmental and social standards as well as for good governance (ESG) are weighted higher. While countries with a poorer ESG scores are weighted lower.
"With the new Xtrackers bond ETFs, we are completing our offering in important segments that are attractive to investors. With ETFs on 'green' government bonds and ESG-weighted euro government bonds, investors can map their sustainability preferences. Our new ETF on US dollar inflation-indexed bonds is the ideal complement to our successful offering in this segment," says Simon Klein, Head of Passive Sales at DWS.
The ETFs are listed on Deutsche Boerse, the Xtrackers II TIPS US Inflation-Linked Bond UCITS ETF 1C additionally on the London Stock Exchange. Listings of the ETFs on other exchanges are planned.
Product Table
| Xtrackers Eurozone Government Green Bond UCITS ETF | Xtrackers Eurozone Government Bond ESG Tilted UCITS ETF | Xtrackers TIPS US Inflation-Linked Bond UCITS ETF Ticker | |
|---|---|---|---|
| ISIN | LU2504532487 | LU2504537445 | LU2504532131 |
| Ticker | XGEZ | XEZB | XTIP |
| TER | 0.18% | 0.12% | 0.07% |
| Underlying Index | iBoxx EUR Eurozone Sovereigns Green Bonds Capped Index | iBoxx EUR Sovereigns ESG Tilted Index | Markit iBoxx TIPS Inflation-Linked Index |
| Income treatment | Distributing | Distributing | Capitalizing |
| Currency | EUR | EUR | USD |
About DWS Group
DWS Group (DWS) is one of the world's leading asset managers with EUR 833bn of assets under management (as of 30 September 2022). Building on more than 60 years of experience, it has a reputation for excellence in Germany, Europe, the Americas and Asia. DWS is recognised by clients globally as a trusted source for integrated investment solutions, stability and innovation across a full spectrum of investment disciplines.
We offer individuals and institutions access to our strong investment capabilities across all major asset classes and solutions aligned to growth trends. Our diverse expertise in Active, Passive and Alternatives asset management – as well as our deep environmental, social and governance focus – complement each other when creating targeted solutions for our clients. Our expertise and on-the-ground-knowledge of our economists, research analysts and investment professionals are brought together in one consistent global Chief Investment Office (CIO View), which guides our investment approach strategically.
DWS wants to innovate and shape the future of investing: with approximately 3,600 employees in offices all over the world, we are local while being one global team. We are investors – entrusted to build the best foundation for our clients’ future.
Key risks
- Investors should note that the Xtrackers UCITS ETFs and ETCs are not capital protected or guaranteed and investors should be prepared and able to sustain losses of the capital invested up to a total loss.
- Shares in the Xtrackers UCITS ETFs which are purchased on the secondary market cannot usually be sold directly back to the relevant fund. Investors must purchase and redeem such shares on the secondary market with the assistance of an intermediary (e.g. a market maker or a stock broker) and may incur fees for doing so (as further described in the applicable prospectus). In addition, investors may pay more than the current net asset value of a share in a Xtrackers UCITS ETF when buying shares on the secondary market, and may receive less than the current net asset value when selling such shares on the secondary market.
- Investments in funds involve numerous risks including, among others, general market risks, credit risks, foreign exchange risks, interest rate risks and liquidity risks. The value of an investment in a Xtrackers UCITS ETF may go down as well as up and investors may not get back the full amount of their original investment.
- Investments in ETC securities will not accrue any interest and performance is subject to the deduction of the product fee.
- Pricing of the ETC securities on the secondary market may be at a significant discount or premium compared to the Value per ETC Security (intrinsic value) published by the Issuer. Investments in Xtrackers ETCs involve numerous risks including but not limited to, general market risks relating to the relevant commodities, exchange rate risks, interest rate risks, inflationary risks, liquidity risks, and legal and regulatory risks.
- Movements in exchange rates can impact the value of your investment. If the currency of your country of residence is different from the currency in which the underlying investments of the fund are made, the value of your investment may increase or decrease subject to movements in exchange rates.
- For a full description of risk factors, please refer to the relevant prospectus.
Important Notice
This press release has been issued in the UK and approved by DWS Investments UK Limited. DWS Investments UK Limited is authorised and regulated by the Financial Conduct Authority. Any reference to “DWS” shall, unless otherwise required by the context, be understood as a reference to DWS Investments UK Limited including any of its parent companies, any of its or its parents affiliates or subsidiaries and, as the case may be, any investment companies promoted or managed by any of those entities.
Past performance is not a guide for future returns.
Xtrackers UCITS ETFs are all ETFs of one of the following platforms: Xtrackers, Xtrackers II or Xtrackers (IE) plc.
Xtrackers, Xtrackers II and Xtrackers (IE) plc are undertakings for collective investment in transferable securities (UCITS) in accordance with the applicable laws and regulations and set up as open-ended investment companies with variable capital and segregated liability between their respective compartments.
Xtrackers and Xtrackers II are incorporated in the Grand Duchy of Luxembourg, are registered with the Luxembourg Trade and Companies’ Register under number B-119.899 (Xtrackers) and B-124.284 (Xtrackers II) respectively and have their registered office at 49, avenue J.F. Kennedy, L-1855 Luxembourg. Xtrackers (IE) plc is incorporated in Ireland with registered number 393802 and has its registered office at 78 Sir John Rogerson’s Quay, Dublin 2, Ireland. DWS Investment S.A. acts as the management company of Xtrackers, Xtrackers II and Xtrackers (IE) plc.
This information is intended for informational purposes only and does not constitute investment advice, recommendation, an offer or solicitation. Any investment decision in relation to an Xtrackers ETF should be based solely on the latest version of the prospectus, the audited annual and, if more recent, un-audited semi-annual reports and the Key Investor Information Document (KIID), all of which are available in English upon request or on www.Xtrackers.com. In the case of any inconsistency with the prospectus, the latest version of the prospectus shall prevail.
© DWS Investments UK Limited 2022.