Report sheds light on European ETF fees

clock

Providers of European ETFs can double their funds' stated management fees through ancillary activities such as securities lending, other enhancements and trading activities, says a new research report from Deutsche Bank.

Christos Costandinides, European Head of ETF Research and Strategy, and David Arnold, European Head of Index Research, have co-authored, In the ETF Labyrinth, Where Does The Thread Begin?report which finds that synthetic ETFs are the most profitable type of fund, generating an average gross profit margin of 69% for their issuers, whereas physically replicated ETFs produce an average gross profit margin of 64%. For synthetic ETFs, the report declares that issuers’ average total revenues are over 1% per annum, more than double the average fund management fee of 0.43%. Deutsche Bank reckons...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on ETFs

Partner Insight: Vanguard European ETF flows summary - August inflows fall

Partner Insight: Vanguard European ETF flows summary - August inflows fall

Read Vanguard's latest monthly summary of flows in the European ETF market.

Vanguard
clock 02 October 2023 • 10 min read
Partner Insight: Vanguard - in times of volatility, low-cost index investing still shines

Partner Insight: Vanguard - in times of volatility, low-cost index investing still shines

Our latest research shows that, for most investors, their best chance of maximising returns over the long term lies in minimising costs by investing in low-cost index funds and ETFs that track their market benchmarks

Stephen Lawrence - Head of Indexing Research, Vanguard Investment Strategy Group
clock 01 August 2023 • 6 min read
Industry Voice: The growth potential of climate change — is it worth the investment?

Industry Voice: The growth potential of climate change — is it worth the investment?

Geopolitics has pushed the issue of energy security up the agenda over the past year, compounding an ever-growing consensus for the need to transition away from fossil fuels and towards renewables. Watch the video podcast to learn more.

Sarka Halas
clock 19 June 2023 • 2 min read