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Deka launches Nasdaq-100 ETF with competitive TER

EditorVenkatesh Jartarkar
Published 10/18/2023, 11:21 AM
© Reuters.

German asset manager Deka has introduced the Deka Nasdaq-100 UCITS ETF (D6RH) on Deutsche Boerse (ETR:DB1Gn) and the Stuttgart Stock Exchange this Wednesday. This new offering aims to replicate the Nasdaq 100 index, which comprises leading non-financial US tech firms. The index has seen a return of 39.2% this year, significantly outperforming the S&P 500's 14.3%.

The launch of D6RH comes after a "special rebalance" of the Nasdaq 100 index due to a breach of weighting restrictions by seven major tech giants. The ETF carries a total expense ratio (TER) of 0.25%, lower than two of the largest funds in its category: the $8.1 billion iShares Nasdaq 100 UCITS ETF (CNDX) and the £4.1 billion Invesco EQQQ Nasdaq-100 UCITS ETF (EQQQ). This makes it an attractive option for investors seeking cost-effective exposure to the high-performing tech sector.

Nasdaq ETFs have gained popularity among investors for their broad coverage of over 3,000 stocks within the Nasdaq Composite Index, predominantly technology and growth companies. This wide coverage allows investors to pursue diverse investment strategies without having to buy each stock separately. Other key benefits include high liquidity from trading on platforms like the New York Stock Exchange and lower expense ratios compared to actively managed mutual funds due to their passive management approach.

The focus on the technology sector by these ETFs provides investors with an opportunity to participate in the sector's growth. Industry leaders such as Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), and Alphabet (NASDAQ:GOOGL) (Google) significantly contribute to the performance of these indices.

ETFs offer a route for investors to gain exposure to the innovative, tech-dominant Nasdaq exchange and potential high returns. For instance, the Invesco QQQ Trust (QQQ) mirrors the Nasdaq-100 Index's portfolio of the largest non-financial companies from sectors like technology, consumer discretionary, healthcare, and communication services. Other options for investors seeking diversified exposure to the broader U.S. stock market include the SPDR S&P 500 ETF Trust (ASX:SPY), which tracks the S&P 500 Index.

This is Deka's first launch since the introduction of the Deka iBoxx MSCI ESG EUR Corporates Green Bond UCITS ETF (D6RE).

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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