Deutsche Asset Management adds USD corporate bond ‘yield plus’ ETF to Xtrackers suite

Deutsche Asset Management (Deutsche AM) has added an ETF providing US dollar corporate bond ‘yield plus’ exposure to its suite of Xtrackers ETFs.

Xtrackers iBoxx USD Corporate Bond Yield Plus UCITS ETF[1] listed today on the London Stock Exchange after listing on the Deutsche Börse last Friday, March 9th, 2018. The ETF provides exposure to the highest-yielding investment-grade bonds that broadly constitute the US dollar investment-grade corporate bond market. Specifically, the ETF focuses on the top 33%, ranked by yield, of bonds that make up the Markit iBoxx USD Corporates Index. The ETF’s index also allows for bonds that were investment-grade at time of inclusion but have since been downgraded (‘fallen angels’), and which can remain in the index as long as they are not lower than rated BB- using average agency ratings as calculated by the index provider IHS Markit.

The resulting ‘yield plus’ index is composed of approximately 1,400 bonds and provides currently 0.47%[2] yield pick-up versus the broader investment-grade corporate bond index, with similar duration and BBB+ average rating.[3]

“Investors looking for strategic bond investments that improve the risk and return profile of their portfolios may be attracted to our new US dollar corporate bond yield plus ETF as it can generate a yield pick-up for currently little additional risk. It achieves this by extracting exposure to higher corporate risk premia, from a broader investment-grade corporate bond index, and keeping lower interest rate exposure than traditional ETFs,” said Olivier Souliac, Strategic Beta Fixed Income Specialist at Deutsche AM.

The new ETF, which has an annual All-in Fee of 0.25% and is a physical replication ETF, complements Deutsche AM’s existing range of yield plus Xtrackers providing exposure to Euro corporate bonds and Eurozone government bonds. The Xtrackers range of yield plus ETFs has over EUR 1.5 billion in assets under management4. Since their launch, benefiting from a supportive market environment for yield-oriented, carry investors, all Xtrackers Yield Plus ETFs have outperformed their respective broad market benchmark[4].

Past performance is not a guide for future returns.

For further information please contact:

John Ferry
Deutsche Asset Management

Product Details     

Name of ETF: Xtrackers iBoxx USD Corporate Bond Yield Plus UCITS ETF
Underlying index name: Markit iBoxx USD Corporates 1-20 Yield Plus Index
ISIN: IE00BF8J5974
Fund Currency: USD
Annual All-in Fee: 0.25%
Physical/Synthetic: Physical  UCITS
Compliant: Yes

Deutsche Asset Management

With EUR 702 billion of assets under management (as of December 31, 2017), Deutsche Asset Management¹ is one of the world’s leading investment management organizations. Deutsche Asset Management offers individuals and institutions traditional and alternative investments across all major asset classes.

Deutsche Asset Management is the brand name of the Asset Management division of the Deutsche Bank Group. The respective legal entities offering products or services under the Deutsche Asset Management brand are specified in the respective contracts, sales materials and other product information documents.

Key risks

Investors should note that the Xtrackers UCITS ETFs 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 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.

Important Notice

This press release has been issued in the UK and approved by Deutsche Asset Management (UK) Limited. Deutsche Asset Management (UK) Limited is authorised and regulated by the Financial Conduct Authority.

Past performance is not a guide for future returns.

Xtrackers iBoxx USD Corporate Bond Yield Plus UCITS ETF is a sub-fund of Xtrackers (IE) plc.

Please refer to the relevant fund’s full prospectus and the latest version of the Key Investor Information Document for more information on Xtrackers (IE) plc. These documents are available free of charge from Deutsche Asset Management (UK) Limited or on and constitute the only binding basis for purchase of shares in the Xtrackers UCITS ETFs. As explained in the relevant offering documents, distribution of ETFs is subject to restrictions in certain jurisdictions. The ETFs described herein may neither be offered for sale nor sold in the USA, in Canada, in Japan to US Persons or to persons residing in the USA.

Xtrackers UCITS ETFs are all ETFs of one of the following platforms: Xtrackers, Xtrackers II or Xtrackers (IE) plc. © Deutsche Asset Management (UK) Limited 2018.

1 . A sub-fund of Xtrackers (IE) plc.

2 . Market cap-weighted yield as of February 23, 2018. Source: Bloomberg

3 . Source: Bloomberg, Moody’s, S&P

4 . Source: Bloomberg, Deutsche AM, as of February 23, 2018. Launch date of the relevant ETFs span from October 2010 to June 2016.


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