Industry Updates

DWS cuts government bond ETF fees

Scott Longley

The ETF price war took another twist this week with DWS moving to slash the cost of its cash and bond Xtrackers ETFs range even as the company said that it was seeing record inflows into the asset classes.

DWS announced that a third of the annual all-in fee on the Xtrackers II EUR Cash Swap UCITS ETF had been lopped off with the new fee set at 0.10%.

Meanwhile, the Xtrackers II US Treasuries UCITS ETF sees its all-in annual fee reduced to 0.12% from 0.15%, the Xtrackers II US Treasuries UCITS ETF EUR hedged goes down to 0.17% from 0.20%, the Xtrackers II US Treasuries UCITS ETF EUR hedged is now 0.12% from 0.15% and finally the Xtrackers II US Treasuries Inflation-Linked UCITS ETF sees its cost drop to 0.12% from 0.20%.

All changes were effective as of the 1 April just gone.

"We are making our US Treasuries and EUR cash offering even more attractive for our clients at a time when, particularly with increased volatility, investors are trading more fixed income exposures using ETFs," said Blanca Koenig, fixed income strategist at DWS.

The news comes after the company saw net inflows of over €1bn in the year‚Äîto-date.

Some of the government bind range have reached some impressive milestones. The Xtrackers II Eurozone Government Bond UCITS ETF now exceeds €2 billion in assets, while the Xtrackers II Global Government Bond UCITS ETF is now close to €1bn. The latter is proving popular, according to DWS, thanks to its currency-hedged share classes.

DWS says that both these ETFs are the largest UCITS ETFs in the market for their respective exposures.

The price war on ETFs came to the fore last month when Lyxor announced it was cutting the total expense ratio on two of its newly-launched Core funds to 0.04%. (Link to: That makes the funds - Lyxor Core Morningstar UK ETF and the Lyxor Core Morningstar US ETF - the cheapest on the market, just below the 0.05% offered by HSBC' Euro Stoxx 50 UCITS ETF which has a TER of 0.05%.

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