Xtrackers Dives Into Thematics With Its First US-Traded ETF

Two funds would receive a boost from recent legislation.

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Reviewed by: Lisa Barr
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Edited by: Daria Solovieva

Xtrackers launched its first three thematic stock exchange-traded funds in the U.S. Thursday, focusing on semiconductors, green infrastructure and cybersecurity stocks. 

Xtrackers, an ETF brand under European asset manager DWS Group, currently has 38 ETFs with $19.5 billion in assets trading in the U.S. The three thematic ETFs it rolled out today are the Xtrackers Semiconductor Select Equity ETF (CHPS), the Xtrackers US Green Infrastructure Select Equity ETF (UPGR) and the Xtrackers Cybersecurity Select Equity ETF (PSWD). 

“This is the starting point of a serious push into the thematic space,” said Arne Noack, head of systematic investment solutions for the Americas at DWS Group. “There are options out there, but we thought they were too expensive. Green infrastructure is not yet covered significantly in the ETF space.” 

Thematic ETFs

With an expense ratio of 0.15%, CHPS is the cheapest semiconductor ETF, compared to the previously cheapest one, the Invesco PHLX Semiconductor ETF (SOXQ), which has an expense ratio of 0.19%.  

PSWD’s expense ratio of 0.20% makes it the cheapest cybersecurity ETF by a wide margin; the next cheapest being the WisdomTree Cybersecurity Fund (WCBR), with an expense ratio of 0.45%. 

UPGR seeks to differentiate itself from the 20 current renewable energy ETFs by also investing in companies that provide environmental services like PureCycle Technologies, a plastic recycling firm, and green fuel firms like biofuel maker Gevo, Inc., among others. 

Amanda Rebello, New York-based head of Xtrackers sales in the U.S., told etf.com that CHPS and PSWD are united by the fact that they both are themes that have received a boost from recent legislation. The CHIPS Act and Inflation Reduction Act, both passed last year, commit large sums of federal funds to increasing U.S. semiconductor production and green infrastructure, respectively.  

“We see economic development entering a new era with the Inflation Reduction Act,” she said. 

Noack also said this is just the beginning of a larger push into thematics that will continue through 2024, and possibly into 2025, with some additional products launching before the end of this year. 

 

Contact Gabe Alpert at [email protected] 

Gabe Alpert is a former data reporter at etf.com with over seven years’ experience in financial journalism. He also previously contributed reporting and analysis to Barron’s Magazine, Investopedia and other publications.