Xtrackers helped boost assets under management of its parent, Germany’s DWS Group, to record levels in the third quarter of this year and the exchange-traded fund business is focussed on attracting more retail investors in Europe and expanding geographically.

DWS was spun off from Deutsche Bank in 2018 and is listed on the Frankfurt Stock Exchange as an independent company, but is still majority owned by the bank.

At the end of October this year DWS Xtrackers was the third largest ETF provider in Europe with $326.2bn in assets, representing a 10.5% market share according to ETFGI, an independent research and consultancy firm. BlackRock’s iShares is the largest ETF provider in the region with $1.26 trillion in assets and 40.6% market share, and European manager Amundi is second with $382.4bn and a share of 12.3%.

ETFGI said: “Together, the top three providers – out of 132 – account for 63.4% of European ETF assets, while the remaining 129 providers each hold less than 8% market share.”

Simon Klein, global head of Xtrackers sales, told Markets Media that he expects the business to have close to $400bn in assets under management by the end of this year.

“We are growing faster than the market and we feel our retail strategy is right,” he added. “We are investing in the franchise and we have 17 open positions.”

Assets in the European ETF industry reached a record $3.11 trillion at the end of October this year, according to ETFGI, surpassing the previous record of $3 trillion in September this year.

Xtrackers’ growth plan includes growing across digital channels and neobrokers to attract more retail investors. Klein said there is huge potential to grow this segment in the UK, in eastern Europe and the Middle East.

“We are on 42 digital channels in Europe and we have  a pipeline to connect to another 10,” added Klein.

Germany is another strong opportunity as it introduced the first ETF savings plans in 2010. The German Investment Funds Association, BVI, launched research on the German ETF market this year and said ETF assets held by German investors increased from €309bn in 2023 to €500bn by June this year.

“Retail contributes about 20% of our assets and this could move to 50/50 by 2030,’ said Klein.

Many U.S ETF issuers have been entering the European market. For example Dimensional Fund Advisors, the U.S. ETF manager listed its first active European ETFs on the London Stock Exchange and Xetra in Frankfurt on 14 November 2025. However, Klein argued that Xtrackers has an advantage as a European firm.

“As a European player in Europe we have knowledge of clients,” he added. “We can provide a gateway to Europe in other regions.”

For example, Xtrackers launched a Europe defence technology ETF in August this year which tracks the performance of the STOXX Europe Total Market Defence Space and Cybersecurity Innovation Index.

Natalia Wolfstetter, director fund analysis at data provider Morningstar, said in a report that through its Xtrackers platform, DWS has built a robust passive franchise. Wolfstetter added that in the passive space, the firm seeks to differentiate itself by responding swiftly to market trends and themes rather than focusing solely on cost leadership.

“As a result, most new product launches are now concentrated in the ETF space, with plans to expand the number of active ETFs, while the active fund range has been streamlined to some degree,” said Wolfstetter. “Initiatives are underway to enhance collaboration and performance across the active lineup, which has been lackluster, particularly in equities.”

Geographical expansion

In July this year the firm launched the Xtrackers S&P 500 Diversified Sector Weight ETF in the U.S. as investors want to avoid the concentration risks in many large-cap benchmarks.

Salvador Gomez, head of Xtrackers sales Americas, said in a statement: “We’re offering a balanced exposure to the S&P 500 by rethinking sector classification and weighting – grounded in real business activity, not just labels.”

The ETF expanded the Xtrackers U.S. product suite to 41 funds, and approximately $27bn in assets under management as of 30 June 2025. As of 16 July 16 2025, Xtrackers had over 170 UCITS ETFs globally with approximately €250bn assets under management.

Klein said: “We grew in the U.S last year by specialising in asset classes and forming partnerships for joint launches.”

In the third quarter Xtrackers listed its first ETFs on the Nasdaq Stockholm in partnership with Levler, a local digital investment platform. The initial launch includes six ETFs  in Swedish kronor with a variety of exposures from global to emerging markets as well as AI & big data.

Xtrackers said in a statement: “This is the next step to expand Xtrackers’ product range to different markets through digital distribution channels which are especially important gateways to ETFs.”

DWS also celebrated its 40th anniversary in Japan in the third quarter of this year. Nissay Asset Management, the asset management arm of DWS’ strategic partner Nippon Life, also listed its first ETF on the Tokyo Stock Exchange in the quarter. DWS said it had worked closely together on this initiative over the past two years with Nissay Asset Management.

In October this year DWS also announced the opening of a new branch in Abu Dhabi.

“This strengthening of its presence in the Middle East marks a significant step forward for the company to offer comprehensive investment solutions in this strategic growth area for DWS, linking clients, markets and opportunities across borders as the gateway to Europe,” added DWS.

On 5 November 2025 Xtrackers, in partnership with ASB Capital, a purpose-driven asset management firm listed an ETF on the London Stock Exchange, which was the first Shari’a-compliant ETF. ASB Capital was launched this year and is licensed by the Dubai Financial Services Authority.

The Sukuk market has been historically difficult to access, with high minimum investment requirements, and the absence of innovative, transparent products.

Hichem Djouhri, senior executive officer at ASB Capital, said in a statement: “Sukuk currently account for 45% of the $2.5 trillion USD-denominated debt market (bonds and Sukuk combined), making Sukuk increasingly difficult for mainstream investors to ignore.”

He continued that the Sukuk market is forecast to exceed $2 trillion by 2030, reflecting its continued expansion and growing investor demand.

Financial results

DWS reported in its third quarter results the group achieved long-term net inflows of €25.7bn in the first nine months of this year which was primarily driven by strong net new assets in passive, including Xtrackers.

“Passive asset management generated net inflows of €10.3bn in the third quarter,” added DWS. “Flows were driven by Xtrackers ETPs (exchange-traded funds and commodities) and supported by institutional mandates.”

Total net flows for the first nine months of the year were €40.5bn, including cash and advisory services.

“This is a new record for DWS for the first three quarters of a year,” added the group. “It is higher than the net flows of almost all past full years, except for 2021, and an improvement of €33.1bn compared to the first nine months of 2024.”

Total assets under management increased by €44bn to a new record of €1,054bn in the third quarter of this year.

DWS added that it reached its second-best financial results for a quarter and its best financial results for the first nine months of a year. Based on this performance, DWS reiterated its cost-income ratio and earnings per share targets for 2025.

Stefan Hoops, chief executive of DWS Group, said in a statement: “With our best nine months financial results ever, our EPS target is well within reach. And while you will not see us taking our eyes off the ball to achieve our targets for 2025, we keep investing into future growth.”