Observers looking for growth within the exchange traded funds industry need not look any further than currency hedged ETFs.
Currency-hedged ETF assets grew 48 percent in 2014 to roughly $20.8 billion, and have grown 1,519 percent over the past two years, according to Deutsche Bank (NYSE: DB), Reuters reports. That number has grown in significant fashion in 2014 and the Deutsche X-trackers MSCI EAFE Hedged Equity ETF (NYSEArca: DBEF) is a big reason why.
As has been the case with some other currency hedged ETFs, DBEF’s asset growth has been exponential, but in the case of DBEF, “jaw-dropping” is an accurate descriptor for the fund’s assert-gathering acumen. With 2015 inflows of $2.13 billion (as of Feb. 17), DBEF has nearly doubled in size just this year to over $4.6 billion.
Only one other currency hedged ETF and just six ETFs overall have added more new assets this year than DBEF. [Behind Deutsche’s ETF Ascent]
Given its current asset-gathering pace, DBEF will double in size this year, marking the second consecutive year the ETF has done so. To be more precise, DBEF has more than tripled in size since mid-December. In mid-October, DBEF had just over $800 million in assets under management. [ETFs That Have Doubled in Size]
More importantly, DBEF is worthy of that asset growth. At a time when developed market central banks, excluding the Federal Reserve, are committing to rampant quantitative easing, lowering interest or even going to negative interest rates, DBEF is shining. The ETF is up 7.6% year-to-date, nearly 200 basis points ahead of the unhedged MSCI EAFE Index.