09.04.2014
By Terry Flanagan

Source Expands ETFs in Germany

Source, a European providers of exchange-traded products, has listed four ETFs in Germany as assets in European-listed ETFs are expected to reach a record this year.

Michael John Lytle, chief development officer and a founding partner at Source, told Markets Media: “We have listed two Man GLG ETFs and two MLPs on Xetra as these are the products where we have seen the biggest demand in euros.”

Two of the new listings at Xetra, part of Deutsche Boerse, are the result of a partnership with hedge fund Man GLG. They enable investors to participate in the strategy approach of GLG Partners which incorporates the views of around 65 brokers so investors can choose between stock corporations from Asia, Australia and New Zealand, or continental Europe.

The other two new listings at Xetra are in partnership with Morningstar and allow investors to participate in the performance of US energy companies through ETFs based on companies which are legally defined as master limited partnerships.

It is possible to list ETFs on more than one venue in the fragmented European market but Lytle said Source tries to avoid cross-listings unless they create value. Source lists ETFs traded in Euros in Germany, those traded in US dollars in London and also lists some products in Switzerland to gain access to Swiss advisory accounts.

In Europe there were 2,070 ETFs/ETPs, with 6,262 listings, from 50 providers listed on 26 exchanges at the end of July according to consultancy ETFGI’s industry insights report.

ETFs and ETPs listed in Europe gathered a record level of $10.6bn in net new assets in July, pushing net new assets to a new high of $42.7bn for the first seven months of the year. Equities gathered the largest net inflows of $6.96bn, followed by fixed income with $2.62bn, and commodities with $717m in net inflows according to ETFGI.

“The most distinguishing feature in our inflows this year has been the interest from new investors and the breadth of interest,” Lytle added.

BlackRock’s iShares gathered the largest net ETF/ETP inflows in Europe in July with $3.08bn according to ETFGI, followed by Deutsche Bank’s db x/db ETC with $1.59bn.

Deborah Fuhr, managing partner at ETFGI, said in a statement: “In July investors invested the majority of new money into equity exposures as investor confidence was positive through most of month. The S&P 500 hit an all-time high during July but ended the month down 1% as market were rattled at the very end of the month by the situations in the Ukraine and Gaza and a poor start to the US earnings season.”

Lytle said: “ETF activity is heavily affected by investor sentiment so if that remains positive then ETF volumes should continue to trade higher. The macro environment has the biggest impact on ETF inflows.”

Featured image via Maimento/Dollar Photo Club

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