Lyxor refreshes several EM ETFs with lower fees and new indices

Dec 19th, 2018 | By | Category: ETF and Index News

Lyxor has refreshed several EM-oriented ETFs with lower total expense ratios (TERs) on six single-country ETFs and new underlying indices for three.

Lyxor lowers fees across several single-country ETFs

Six funds have seen their TERs lowered from 0.65% to 0.45%.

The funds, which are listed across the main European exchanges, include products targeting the equity markets of Turkey, South Korea, Malaysia, Taiwan, South Africa, Indonesia and Eastern Europe.

The six ETFs that have had their TERs lowered, by more than 30%, from 0.65% to 0.45%, include funds tracking MSCI single-country indices.

The indices represent large and mid-cap equity performance, covering approximately 85% of each country’s total market capitalization.

The funds include the Lyxor MSCI Korea UCITS ETF (KRW LN), the Lyxor MSCI Malaysia UCITS ETF (MALU LN), the Lyxor MSCI Taiwan UCITS ETF (TWND LN), the Lyxor MSCI Indonesia UCITS ETF (INDO FP), the Lyxor MSCI Turkey UCITS ETF (TURL LN) and the Lyxor MSCI South Africa UCITS ETF (AFSU LN).

These latter two funds have also had their underlying indices replaced and names updated. They previously tracked the Dow Jones Turkey Titans 20 Index and the FTSE JSE TOP 40 Index respectively, but are now referenced to MSCI country indices.

The newly adopted indices are broader in coverage than their predecessors, meaning the Turkey fund now provides exposure to 24 constituents, rather than 20, and the South Africa fund comprises 54 stocks compared to 40 previously.

Collectively, the ETFs affected house approximately $520 million in assets under management – the largest funds being the Korea ($180m), Indonesia ($150m) and Turkey ($100m) exposures – meaning the fee reductions will result in immediate savings for investors of in excess of $1 million per annum at today’s prices (assuming static AUM).

As part of the product refresh, Lyxor has also changed the underlying index on its Lyxor Eastern Europe UCITS ETF (CECD LN) from the CECE Composite Index in favour of the MSCI EM Eastern Europe ex Russia Index.

The new index provides broadly similar exposure, tracking 29 blue-chip stocks across Poland, Hungary, and the Czech Republic. This fund has approximately $190m in AUM. Its TER remains unchanged at 0.50%.

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