DWS teases active thematic ETFs in Europe

German asset manager eyes expansion in the active space

Theo Andrew

Simon Klein

DWS is considering entering the active thematic ETF space as it weighs up expansion into the space in a bid to target retail investors.

Speaking to ETF Stream, Simon Klein, global head of Xtrackers sales at DWS, said it was still discussing which active approach it would take but looked to be favouring thematics.

“Tax benefits have been a key driver of active ETFs in the US, but we always have to develop products and it is clear digital channels are asking for more stories,” Klein (pictured) said.

“One of our best-selling products is our AI and big data ETF, the retail customer likes storytelling and active ETFs fit very well into that.”

The Xtrackers Artificial Intelligence & Big Data UCITS ETF (XAIX) currently houses $3.6bn assets under management (AUM).

He added it depends on how you classify “active” within ETFs, with many of the current launches taking a rules-based systematic approach such as JP Morgan Asset Management and Fidelity International.

The former has gone on to dominate the space in Europe and accounts for over a third of the $35bn AUM in Europe.

“The question is, is this a discretionary fund or a rules-based active fund? We will figure that out, there are a couple of ideas we have in mind and we can definitely come out with something,” Klein added.

Should they choose to take a more ‘concentrated’ active approach the German asset manager would be closer to the likes of ARK Invest Europe, which launched three actively managed ETFs covering innovation, genomics and AI.

DWS already houses an active ETF in Europe, the $620m Xtrackers Portfolio UCITS ETF (XQUI), a multi-asset ETF which invests in a basket of ETFs.

The group launched its first active ETF in the US in February, the Xtrackers RREEF Global Natural Resources ETF, a sign of the group’s potential thematic tilt within active ETFs.

BlackRock is the only issuer of the big three in Europe to have launched an equity active ETF after it unveiled the iShares World Equity High Income UCITS ETF (WINC) and iShares US Equity High Income UCITS ETF (INCU) in March.

Amundi recently told ETF Stream there were “no fundamentals” for active ETFs in Europe.

Speaking at ETF Stream’s EFT Ecosystem Unwrapped 2024 event, Robyn Laidlaw, head of distribution for Europe at Vanguard, said it was eyeing up a potential launch in the active fixed income ETF space.

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