Daily ETF Watch: DB Debuts Smart Beta Funds

November 24, 2015

Today Deutsche Bank launched a pair of funds that represent its first moves into the multifactor smart-beta ETF space. The Deutsche X-trackers FTSE Developed ex US Enhanced Beta ETF (DEEF) and Deutsche X-trackers Russell 1000 Enhanced Beta ETF (DEUS) track benchmarks derived from the FTSE Developed ex US Index and the Russell 1000 Index.

The underlying benchmarks are created by screening their parent indexes for companies with meaningful exposure to the value, momentum, quality, low volatility and size factors. Index holdings are weighted by their exposure to all five factors.

DEEF’s index included 1,177 components from 23 developed markets as of Sept. 30, while DEUS’s index included 834 U.S. securitites.

DEEF comes with an expense ratio of 0.35%, while DEUS charges 0.25%.

FlexShares Debuts Real Assets ETF

The FlexShares Real Assets Allocation Index Fund (ASET) rolled out today. The ETF is an index-based fund of funds that invests primarily in other FlexShares ETFs.

Those funds ASET invests in include the FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR | B-85), the FlexShares Global Quality Real Estate Index Fund (GQRE | C-80) and the FlexShares STOXX Global Broad Infrastructure Index Fund (NFRA | B-56).

ASET’s index seeks to achieve optimal exposure to the three underlying ETFs while limiting volatility. On Oct. 30, the largest weighting in the index went to NFRA at 50.2%, with GQRE weighted at 39.9% and GUNR at 9.9%.

ASET comes with an expense ratio of 0.57%.

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