Xetra – Ten Years as Leading Trading Venue for ETFs in Europe
651 listed ETFs with fund assets totaling €134.6 billion/ Blue-chip ETFs are the most liquid instrument group on Xetra
Deutsche Börse: On 11 April 2000, Deutsche Börse became the first European stock exchange to start trading in exchange-traded index funds (ETFs) with its XTF segment. The segment has been growing on an ongoing basis ever since: with 651 listed ETFs of 14 providers, fund assets totaling €134.6 billion and an average monthly trading volume of €12.6 billion, Xetra is now by far the leading European trading venue for ETFs.
“As the number one ETF trading venue, Xetra offers private and institutional investors alike the largest product range in the whole of Europe, as well as highly liquid trading and, as a result, very favorable conditions. Issuers benefit from the international scope of our infrastructure and from the low-cost, comprehensive services offered by Xetra as a listing venue”, said Rainer Riess, Managing Director of Xetra Market Development at Deutsche Börse.
The first ETFs on Xetra were based on the European equity indices EURO STOXX 50 and STOXX Europe 50, as well as on the DAX. Today, ETFs on equities, bonds and commodities are available to private and institutional investors also when employing a variety of different strategies such as short, dividend yields or value/growth. Around €93 billion of the current fund assets totaling over €134 billion is invested in equity index ETFs. The iShares DAX ETF achieves the highest trading volume in the XTF segment by far with an average of €1.3 billion per month.
STOXX not only offered the first indices for ETFs in Europe, but has made an ongoing contribution to the development of the ETF segment with its broad range of innovative indices. The most recent example is the STOXX Europe 600 Optimised Marked Quartile index family, which was expanded to include four additional ETFs listed on Xetra this week. All in all, more than 30 percent of the ETF assets in Europe are invested in ETFs on STOXX indices. “Innovative indices and the ETFs launched on them offer a broad investor base cost-effective access to entire themes, sectors and markets, and allow for a whole range of strategies. Successful ETFs are based on transparent, strictly rule-based and tradable indices,” noted Hartmut Graf, head of Deutsche Börse’s index business and CEO of STOXX Ltd.
In Europe, more than 40 percent of ETF trading volume goes through Xetra, a figure that is as high as around 95 percent as far as Germany is concerned. The liquidity bundled in this manner narrows the trading spreads and lowers trading costs. In 2009, the bid-ask spread for the 20 most liquid equity ETFs on Xetra averaged only 9 basis points, and came in at an average of 8 basis points in the first quarter of 2010. Blue-chip ETFs are the most liquid instrument group on Xetra.
You can find an overview of further facts and figures on 10 years of ETF trading in Europe in the attached document.
Exchange-traded funds are passively managed funds that are traded on the stock exchange, their performance follows that of an index. These indices can be national or international equity indices, commodity and real estate indices or bond indices. This means that indices, and entire markets, can be traded as easily as equities can.
About the XTF segment
XTF Exchange Traded Funds is the trading segment for actively and passively managed ETFs on Xetra. Deutsche Börse’s XTF segment is the market leader with both the largest number of ETFs and the highest trading volume in Europe. In Germany, around 98 percent of the turnover in ETFs is processed via Deutsche Börse: 95 percent goes through Xetra, while 2.5 percent is handled by the trading floor of the Frankfurt Stock Exchange. The XTF segment has a European market share of 41 percent.
This business unit of Deutsche Börse provides listing, trading and clearing services for issuers, intermediaries and investors. Xetra provides efficient access to the capital markets, supports the latest trading techniques and provides an ever-growing range of tradable securities. The trading system of the same name sets the highest standards in terms of reliability, security, speed and innovation. Xetra offers the highest liquidity, transparency and cost efficiency to more than 250 European banks and brokerage firms from 19 countries. Approximately 400,000 securities are traded using Xetra technology, more than on any other trading platform.
About STOXX Ltd.
STOXX Ltd. is a global index provider that calculates a global, broad-based family of more than 2,500 strictly rule-based and transparent indices. STOXX calculates and manages the leading European equity indices EURO STOXX 50, STOXX Europe 50 and STOXX Europe 600, as well as the global STOXX Global 1800 Index, including its sub-indices for the North America and Asia-Pacific regions. STOXX indices are used by more than 400 licensees across the globe as underlyings for exchange-traded funds (ETFs), futures and options, structured products and passively managed investment funds. Three of the leading European ETFs and 30 percent of the total assets under management are based on STOXX indices. In Europe, STOXX Ltd. is the leading provider of products for the derivatives sector, and it is ranked third in the world. STOXX Ltd. is a company that is owned by Deutsche Börse AG and SIX Group AG. www.stoxx.com
DAX®, Xetra® and XTF® are registered trademarks of Deutsche Börse AG. EURO STOXX 50® and STOXX® are registered trademarks of STOXX Ltd.
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