Source unveils eurozone banks ETF

Source has launched its EuroStoxx Optimised Banks ETF, seeking to provide exposure to the most liquid eurozone banks.

The ETF, trading on the Deutsche Boerse’s Xetra platform at a total expense ratio of 0.30%, comes alongside Source’s existing Stoxx Europe 600 Bank ETF, which has traded over €2bn on average since May 2010.

Source says these volumes have been driven by the performance dynamics and macro environment surrounding European banks, but adds the relative performance of banks in countries such as Spain has highlighted the need for a tradable ETF targeting eurozone banks.

Source CEO Ted Hood explains: “We have seen a significant increase in demand for eurozone banks sector exposure.”

The EuroStoxx Optimised Banks ETF will track an underlying index comprised of 24 euro denominated stocks selected from the EuroStoxx universe of 312 companies from 12 eurozone countries. By comparison, the Stoxx Europe 600 Banks ETF covers 600 constituents from 18 countries within Europe.

As of 7 April, the largest constituent of the Optimised Banks ETF was Santander, weighted at nearly 21% of the fund. Other significant components include Deutsche Bank and BNP Paribas. 

The launch also signifies the latest addition to Source’s range of European optimised sector ETFs, which now consists of 19 products. The platform, which utilises benchmarks with a reduced exposure to illiquid stocks, has seen turnover of over €120bn since its launch in June 2009.

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