UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22487
DBX ETF Trust
(Exact name of registrant as specified in charter)
345 Park Avenue
New York, New York 10154
(Address of principal executive offices) (Zip code)
Freddi Klassen
DBX ETF Trust
345 Park Avenue
New York, New York 10154
(Name and address of agent for service)
Registrants telephone number, including area code: (212) 250-4352
Date of fiscal year end: August 31
Date of reporting period: February 28, 2019
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (OMB) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
The Report to Shareholders is attached herewith.
February 28, 2019
Semi-Annual Report
DBX ETF Trust
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (DEEF)
Xtrackers FTSE Emerging Comprehensive Factor ETF (DEMG)
Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS)
Xtrackers Russell 1000 US QARP ETF (QARP)
Xtrackers Russell 2000 Comprehensive Factor ETF (DESC)
DBX ETF Trust
Page | ||||
1 | ||||
Portfolio Summary |
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2 | ||||
3 | ||||
4 | ||||
5 | ||||
6 | ||||
7 | ||||
Schedule of Investments |
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8 | ||||
22 | ||||
32 | ||||
41 | ||||
46 | ||||
62 | ||||
64 | ||||
66 | ||||
69 | ||||
72 | ||||
Board Considerations in Approval of Investment Advisory Contracts |
81 | |||
83 | ||||
84 |
To our Shareholders: (Unaudited)
Dear Shareholder,
We are pleased to provide this semi-annual report for our five comprehensive factor equity ETFs for the period ended February 28, 2019.
Global economic growth held on in positive territory as the flag bearer, the U.S., anchored robust GDP owing to an improvement in fiscal stimulus and job markets. Despite tax cuts and a stronger currency under the Trump administration, resilient business sentiment drove growth a notch higher in the U.S. Growth in the Eurozone had slowed during the period, weighed down by lower manufacturing index readings in Germany, civil unrest in France and a lack of resolution on Brexit proceedings. Interest rates were, by and large, accommodative from major central banks, namely the European Central Bank (ECB), the Bank of China (BoC), the Bank of Japan (BoJ) and even the Federal Reserve (Fed), which carried out interest rate hikes at a slower pace. However, they failed to improve inflation numbers within their respective economies, which ended lower. In a shift of focus, emerging economies were vulnerable amid a trade war among major economies and a strong USD, which hurt growth factors.
In the U.S., tax reforms provided the required fiscal stimulus, boosting investor confidence, business and government investment, and corporate earnings. Equity markets spiked on these advantageous conditions, reaching all-time highs and validating market sentiments. Job markets witnessed some volatility, partially due to the temporary government shutdown, but the vast retiring workforce and tighter immigration regulations returned the unemployment rate to one of the lowest in the near term. On the flip side, the trade deficit reported the largest gap as a result of the many political battles the government had taken up simultaneously.
The ECB continued to maintain an easy monetary framework with a view to achieve their long-term inflation targets. Eurozone GDP was reduced substantially from the start of the review period, mainly due to a fall in inventories. Household consumption, government spending and fixed investments partly offset the fall and maintained growth. In addition, the ECB promised its support by indicating a longer zero benchmark phase and by unveiling cheaper funding for banks. Unemployment fell to its lowest in the past decade, signaling optimism. Furthermore, the trade surplus widened on the back of steady exports.
Chinas GDP growth fell to its lowest point in 28 years, riddled by a fierce trade war with the U.S. and a shadow-banking outburst. The Japanese economy reported a similar fate as growth slipped due to weak output and exports. Following the same trajectory, inflation rates in both countries were a far cry from their central banks targets. Equity markets in China and Japan stumbled for a brief phase, before ending at a sideways position for the period.
As the global economic markets continue this long run of the growth cycle, it is expected to move further at a slower pace than before. On the sidelines, however, a dark tunnel ahead of government policy issues like the unfriendly global trade environment and Brexit negotiations remains a source of concern. In such volatile markets, diversifying factors may be a better positioning than pursuing a single-factor approach. However, whether markets remain relatively calm or we do in fact witness some episodic volatility, our view is that retaining a diversified factor approach is right. We believe it takes advantage of the relatively uncorrelated nature of their excess returns, and mitigates the need to try and time a particular market cycle.
Our team appreciates your trust and looks forward to continue serving your investment needs through innovative index-driven strategies.
Sincerely,
/s/ Freddi Klassen
Freddi Klassen
President and Chief Executive Officer
Assumptions, estimates and opinions contained in this document constitute our judgment as of the date of the document and are subject to change without notice. Any projections are based on a number of assumptions as to market conditions and there can be no guarantee that any projected results will be achieved. Past performance is not a guarantee of future results.
1
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (DEEF)
The Xtrackers FTSE Developed ex US Comprehensive Factor ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the FTSE Developed ex US Comprehensive Factor Index (the Underlying Index). The Underlying Index is designed to track the equity market performance of companies in developed countries (except the United States) selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the FTSE Developed ex US Index, which is comprised of large- and mid-capitalization equity securities from developed markets (except the United States). It is not possible to invest directly into an index.
Sector Diversification* as of 2/28/19 |
Industrials |
22.6% | |||
Real Estate |
14.0% | |||
Consumer Discretionary |
10.9% | |||
Materials |
10.1% | |||
Consumer Staples |
8.7% | |||
Utilities |
8.1% | |||
Financials |
7.9% | |||
Communication Services |
4.9% | |||
Energy |
4.4% | |||
Health Care |
4.2% | |||
Information Technology |
4.2% | |||
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Total |
100.0% |
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 8.
2
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers FTSE Emerging Comprehensive Factor ETF (DEMG)
Xtrackers FTSE Emerging Comprehensive Factor ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the FTSE Emerging Comprehensive Factor Index (the Underlying Index). The Underlying Index is designed to track the equity market performance of companies in emerging market countries selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the FTSE Emerging Index, which is comprised of large- and mid-cap equity securities from emerging markets. It is not possible to invest directly into an index.
Sector Diversification* as of 2/28/19 |
Industrials |
12.8% | |||
Financials |
12.8% | |||
Energy |
12.8% | |||
Consumer Staples |
11.4% | |||
Materials |
11.3% | |||
Utilities |
9.2% | |||
Information Technology |
8.4% | |||
Consumer Discretionary |
7.1% | |||
Communication Services |
5.9% | |||
Real Estate |
5.7% | |||
Health Care |
2.6% | |||
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Total |
100.0% |
* As a percent of total investments excluding exchange-traded funds, securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 22.
3
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Russell 1000 Comprehensive Factor ETF (DEUS)
Xtrackers Russell 1000 Comprehensive Factor ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Russell 1000 Comprehensive Factor Index (the Underlying Index). The Underlying Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 1000 Index, which is comprised of large-cap equity securities from issuers in the United States. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 32.
4
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Russell 1000 US QARP ETF (QARP)
Xtrackers Russell 1000 US QARP ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Russell 1000 2Qual/Val 5% Capped Factor Index (the Underlying Index). The Underlying Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of quality and value. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 1000 Index, which is comprised of large-cap equity securities from issuers in the United States. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 41.
5
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Russell 2000 Comprehensive Factor ETF (DESC)
Xtrackers Russell 2000 Comprehensive Factor ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Russell 2000 Comprehensive Factor Index (the Underlying Index). The Underlying Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 2000 Index, which is comprised of small-cap equity securities from issuers in the United States. It is not possible to invest directly into an index.
* As a percent of total investments excluding exchange-traded funds, securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 46.
6
DBX ETF Trust
As a shareholder of one or more of the Funds, you incur two types of costs: (1) transaction costs, including brokerage commissions paid on purchases and sales of fund shares, and (2) ongoing costs, including management fees and other Fund expenses. In the most recent six-month period the Funds limited these expenses; had they not done so, expenses would have been higher. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The examples in the table are based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (September 1, 2018 to February 28, 2019).
Actual expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading Expenses Paid During the Period to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds actual expense ratios and an assumed rate of return of 5% per year before expenses (which is not the Funds actual return). The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value September 1, 2018 |
Ending Account Value February 28, 2019 |
Annualized Expense Ratio |
Expenses Paid During the Period Per $1,000(1) |
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Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
| |||||||||||||||
Actual |
$ | 1,000.00 | $ | 963.40 | 0.35 | % | $ | 1.70 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.06 | 0.35 | % | $ | 1.76 | ||||||||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
| |||||||||||||||
Actual |
$ | 1,000.00 | $ | 999.70 | 0.50 | % | $ | 2.48 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,022.32 | 0.50 | % | $ | 2.51 | ||||||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
| |||||||||||||||
Actual |
$ | 1,000.00 | $ | 961.80 | 0.17 | % | $ | 0.83 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.95 | 0.17 | % | $ | 0.85 | ||||||||
Xtrackers Russell 1000 QARP ETF |
| |||||||||||||||
Actual |
$ | 1,000.00 | $ | 970.50 | 0.19 | % | $ | 0.93 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.85 | 0.19 | % | $ | 0.95 | ||||||||
Xtrackers Russell 2000 Comprehensive Factor ETF |
| |||||||||||||||
Actual |
$ | 1,000.00 | $ | 909.00 | 0.30 | % | $ | 1.42 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.31 | 0.30 | % | $ | 1.51 |
(1) Expenses are equal to each Funds annualized expense ratio, multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent six-month period), then divided by 365.
7
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 8 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 9 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 10 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 11 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 12 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 13 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 14 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 15 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 16 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 17 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 18 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 19 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
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COMMON STOCKS 0.0% |
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Germany 0.0% |
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DWS Group GmbH & Co. KGaA, 144A*(d) |
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| 16,544 | | | 2,295 | | | 634 | 18,839 | ||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 1.1% |
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DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (f)(g) |
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227,652 | 662,978 | (h) | | | | 2,773 | | 890,630 | 890,630 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.0% |
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DWS Government Money Market Series Institutional Shares, 2.38% (f) |
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| 2,065,337 | (2,054,241 | ) | | | 543 | | 11,096 | 11,096 | |||||||||||||||||||||||||||||
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227,652 | 2,744,859 | (2,054,241 | ) | | 2,295 | 3,316 | | 902,360 | 920,565 | |||||||||||||||||||||||||||||
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* | Non-income producing security. |
(a) | Stapled Security A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately. |
(b) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $1,165,922, which is 1.4% of net assets. |
(c) | Securities are listed in country of domicile and trade on exchanges within the FTSE Developed ex US Comprehensive Factor Index. |
(d) | Affiliated issuer. The security is owned in proportion with its representation in the index. |
(e) | Investment was valued using significant unobservable inputs. |
(f) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(g) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $434,944. |
(h) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
CDI: | Chess Depositary Interest |
REIT: | Real Estate Investment Trust |
RSP: | Risparmio (Convertible Savings Shares) |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
At February 28, 2019, open futures contract purchased was as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Appreciation |
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MSCI EAFE Futures |
USD | 2 | $ | 166,910 | $186,900 | 3/15/2019 | $ | 19,990 |
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
See Notes to Financial Statements. | 20 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Developed ex US Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (i) |
$ | 81,909,572 | $ | | $ | | $ | 81,909,572 | ||||||||
Preferred Stocks (i) |
169,946 | | 40 | 169,986 | ||||||||||||
Short-Term Investments (i) |
901,726 | | | 901,726 | ||||||||||||
Derivatives (j) |
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Futures Contracts |
19,990 | | | 19,990 | ||||||||||||
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TOTAL |
$ | 83,001,234 | $ | | $ | 40 | $ | 83,001,274 | ||||||||
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(i) | See Schedule of Investments for additional detailed categorizations. |
(j) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
During the period ended February 28, 2019, the amount of transfers between Level 3 and Level 1 was $40,835. The investment was transferred from Level 3 to Level 1 due to the availability of a pricing source supported by observable inputs.
See Notes to Financial Statements. | 21 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 22 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 23 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 24 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 25 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 26 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 27 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 28 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 29 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 30 |
DBX ETF Trust
Schedule of Investments
Xtrackers FTSE Emerging Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
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SECURITIES LENDING COLLATERAL 2.9% |
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DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (d)(e) |
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90,527 | 88,520 | (f) | | | | 215 | | 179,047 | 179,047 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.0% |
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DWS Government Money Market Series Institutional Shares, 2.38% (d) |
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| 127,781 | (126,110 | ) | | | 25 | | 1,671 | 1,671 | |||||||||||||||||||||||||||||
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90,527 | 216,301 | (126,110 | ) | | | 240 | | 180,718 | 180,718 | |||||||||||||||||||||||||||||
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* | Non-income producing security. |
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $167,536, which is 2.7% of net assets. |
(b) | Investment was valued using significant unobservable inputs. |
(c) | Stapled Security A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately. |
(d) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(e) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $32,748. |
(f) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
ADR: | American Depositary Receipt |
CPO: | Ordinary Participation Certificates |
GDR: | Global Depositary Receipt |
NVDR: | Non Voting Depositary Receipt |
PJSC: | Public Joint Stock Company |
QSC: | Qatari Shareholders Company |
REIT: | Real Estate Investment Trust |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (g) |
$ | 5,955,776 | $ | | $ | 1,866 | $ | 5,957,642 | ||||||||
Preferred Stocks (g) |
194,357 | | | 194,357 | ||||||||||||
Rights |
0 | | | 0 | ||||||||||||
Warrant |
41 | | | 41 | ||||||||||||
Exchange-Traded Funds |
51,637 | | | 51,637 | ||||||||||||
Short-Term Investments (g) |
180,718 | | | 180,718 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 6,382,529 | $ | | $ | 1,866 | $ | 6,384,395 | ||||||||
|
|
|
|
|
|
|
|
(g) | See Schedule of Investments for additional detailed categorizations. |
During the period ended February 28, 2019, the amount of transfers between Level 1 and Level 3 was $1,069. The investments were transferred from Level 1 to Level 3 due to the lack of observable market data due to a decrease in market activity.
See Notes to Financial Statements. | 31 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 32 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 33 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 34 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 35 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 36 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 37 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 38 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 39 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 0.1% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
64,770 | 97,190 | (d) | | | | 3,510 | | 161,960 | 161,960 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.2% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 4,564,291 | (4,205,634 | ) | | | 9,078 | | 358,657 | 358,657 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
64,770 | 4,661,481 | (4,205,634 | ) | | | 12,588 | | 520,617 | 520,617 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* | Non-income producing security. |
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $21,477,775, which is 11.0% of net assets. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $21,848,170. |
(d) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
REIT: | Real Estate Investment Trust |
At February 28, 2019, open futures contracts purchased were as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Appreciation |
||||||||||||||||||
E-Mini S&P 500 Futures |
USD | 1 | $ | 125,237 | $ | 139,235 | 3/15/2019 | $ | 13,998 | |||||||||||||||
E-Mini S&P MidCap 400 Futures |
USD | 1 | 165,090 | 191,080 | 3/15/2019 | 25,990 | ||||||||||||||||||
|
|
|||||||||||||||||||||||
Total unrealized appreciation |
$ | 39,988 | ||||||||||||||||||||||
|
|
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (e) |
$ | 194,991,245 | $ | | $ | | $ | 194,991,245 | ||||||||
Short-Term Investments (e) |
520,617 | | | 520,617 | ||||||||||||
Derivatives (f) |
||||||||||||||||
Futures Contracts |
39,988 | | | 39,988 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 195,551,850 | $ | | $ | | $ | 195,551,850 | ||||||||
|
|
|
|
|
|
|
|
(e) | See Schedule of Investments for additional detailed categorizations. |
(f) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
See Notes to Financial Statements. | 40 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 US QARP ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 41 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 US QARP ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 42 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 US QARP ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 43 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 US QARP ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 0.1% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares , 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
| 111,047 | (d) | | | | 1,170 | | 111,047 | 111,047 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.2% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares , 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 835,489 | (575,141 | ) | | | 895 | | 260,348 | 260,348 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| 946,536 | (575,141 | ) | | | 2,065 | | 371,395 | 371,395 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements. | 44 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 1000 US QARP ETF (Continued)
February 28, 2019 (Unaudited)
* | Non-income producing security. |
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $6,671,667, which is 5.3% of net assets. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $6,714,482. |
(d) | Represents the net increase (purchases cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
REIT: | Real Estate Investment Trust |
At February 28, 2019, open futures contract purchased was as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Appreciation |
||||||||||||||
E-Mini S&P 500 Futures |
USD | 3 | $ | 404,187 | $417,705 | 3/15/2019 | $ | 13,518 |
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (e) |
$ | 125,394,430 | $ | | $ | | $ | 125,394,430 | ||||||||
Short-Term Investments (e) |
371,395 | | | 371,395 | ||||||||||||
Derivatives (f) |
||||||||||||||||
Futures Contract |
13,518 | | | 13,518 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 125,779,343 | $ | | $ | | $ | 125,779,343 | ||||||||
|
|
|
|
|
|
|
|
(e) | See Schedule of Investments for additional detailed categorizations. |
(f) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
See Notes to Financial Statements. | 45 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 46 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 47 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 48 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 49 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 50 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 51 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 52 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 53 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 54 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 55 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 56 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 57 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 58 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 59 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 2.2% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares , 2.31% (c)(d) |
||||||||||||||||||||||||||||||||||||||
311,072 | | (84,961 | )(e) | | | 2,193 | | 226,111 | 226,111 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.7% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares , 2.38% (c) |
||||||||||||||||||||||||||||||||||||||
| 438,415 | (363,885 | ) | | | 659 | | 74,530 | 74,530 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
311,072 | 438,415 | (448,846 | ) | | | 2,852 | | 300,641 | 300,641 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* | Non-income producing security. |
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $2,598,225, which is 25.3% of net assets. |
(b) | Investment was valued using significant unobservable inputs. |
(c) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(d) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $2,435,042. |
(e) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
CVR: | Contingent Value Rights |
REIT: | Real Estate Investment Trust |
At February 28, 2019, open futures contract purchased was as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Appreciation |
||||||||||||||||||
E-Mini Russell 2000 |
USD | 1 | $ | 67,385 | $ | 78,775 | 3/15/2019 | $ | 11,390 |
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
See Notes to Financial Statements. | 60 |
DBX ETF Trust
Schedule of Investments
Xtrackers Russell 2000 Comprehensive Factor ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (f) |
$ | 10,162,597 | $ | | $ | | $ | 10,162,597 | ||||||||
Rights (f) |
| | 444 | 444 | ||||||||||||
Exchange-Traded Funds |
31,973 | | | 31,973 | ||||||||||||
Short-Term Investments (f) |
300,641 | | | 300,641 | ||||||||||||
Derivatives (g) |
||||||||||||||||
Futures Contracts |
11,390 | | | 11,390 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 10,506,601 | $ | | $ | 444 | $ | 10,507,045 | ||||||||
|
|
|
|
|
|
|
|
(f) | See Schedule of Investments for additional detailed categorizations. |
(g) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
See Notes to Financial Statements. | 61 |
DBX ETF Trust
February 28, 2019 (Unaudited)
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
Xtrackers FTSE Emerging Comprehensive Factor ETF |
Xtrackers Russell 1000 Comprehensive Factor ETF |
Xtrackers Russell 1000 US QARP ETF |
|||||||||||||
Assets |
||||||||||||||||
Investment in non-affiliated securities at value |
$ | 82,060,719 | $ | 6,203,677 | $ | 194,991,245 | $ | 125,394,430 | ||||||||
Investment in affiliated securities at value |
18,839 | | | | ||||||||||||
Investment in DWS Government Money Market Series |
11,096 | 1,671 | 358,657 | 260,348 | ||||||||||||
Investment in DWS Government & Agency Securities Portfolio* |
890,630 | 179,047 | 161,960 | 111,047 | ||||||||||||
Foreign currency at value |
116,760 | 5,308 | | | ||||||||||||
Deposit with broker for futures contracts |
9,000 | | 14,200 | 18,000 | ||||||||||||
Receivables: | ||||||||||||||||
Dividends |
158,795 | 8,893 | 332,405 | 264,138 | ||||||||||||
Securities lending income |
385 | 44 | 1,911 | 396 | ||||||||||||
Foreign tax reclaim |
9,731 | 535 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Assets |
$ | 83,275,955 | $ | 6,399,175 | $ | 195,860,378 | $ | 126,048,359 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities |
||||||||||||||||
Payable upon return of securities loaned |
$ | 890,630 | $ | 179,047 | $ | 161,960 | $ | 111,047 | ||||||||
Payables: | ||||||||||||||||
Investment securities purchased |
38,461 | | | | ||||||||||||
Investment advisory fees |
20,434 | 2,385 | 24,348 | 16,015 | ||||||||||||
Variation margin on futures contracts |
430 | | 1,330 | 1,560 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Liabilities |
949,955 | 181,432 | 187,638 | 128,622 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Assets, at value |
$ | 82,326,000 | $ | 6,217,743 | $ | 195,672,740 | $ | 125,919,737 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Assets Consist of |
||||||||||||||||
Paid-in capital |
$ | 84,745,447 | $ | 6,407,649 | $ | 190,657,389 | $ | 122,093,751 | ||||||||
Distributable earnings (loss) |
(2,419,447 | ) | (189,906 | ) | 5,015,351 | 3,825,986 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Assets, at value |
$ | 82,326,000 | $ | 6,217,743 | $ | 195,672,740 | $ | 125,919,737 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Number of Common Shares outstanding |
3,000,001 | 250,001 | 6,050,001 | 4,800,001 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Asset Value |
$ | 27.44 | $ | 24.87 | $ | 32.34 | $ | 26.23 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Investment in non-affiliated securities at cost |
$ | 83,068,922 | $ | 6,090,302 | $ | 179,361,543 | $ | 121,358,663 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Investment in affiliated securities at cost |
$ | 16,544 | $ | | $ | | $ | | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Value of securities loaned |
$ | 1,165,922 | $ | 167,536 | $ | 21,477,775 | $ | 6,671,667 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Investment in DWS Government Money Market Series at cost |
$ | 11,096 | $ | 1,671 | $ | 358,657 | $ | 260,348 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Investment in DWS Government & Agency Securities Portfolio at cost* |
$ | 890,630 | $ | 179,047 | $ | 161,960 | $ | 111,047 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Non-cash collateral for securities on loan |
$ | 434,944 | $ | 32,748 | $ | 21,848,170 | $ | 6,714,482 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Foreign currency at cost |
$ | 116,559 | $ | 5,304 | $ | | $ | | ||||||||
|
|
|
|
|
|
|
|
* | Represents collateral on securities loaned. |
See Notes to Financial Statements. | 62 |
DBX ETF Trust
Statements of Assets and Liabilities (Continued)
February 28, 2019 (Unaudited)
Xtrackers Russell 2000 Comprehensive Factor ETF |
||||
Assets |
||||
Investment in non-affiliated securities at value |
$ | 10,195,014 | ||
Investment in DWS Government Money Market Series |
74,530 | |||
Investment in DWS Government & Agency Securities Portfolio* |
226,111 | |||
Deposit with broker for futures contracts |
3,550 | |||
Receivables: | ||||
Dividends |
9,714 | |||
Securities lending income |
394 | |||
|
|
|||
Total Assets |
$ | 10,509,313 | ||
|
|
|||
Liabilities |
||||
Payable upon return of securities loaned |
$ | 226,111 | ||
Payables: | ||||
Investment advisory fees |
2,315 | |||
Variation margin on futures contracts |
330 | |||
|
|
|||
Total Liabilities |
228,756 | |||
|
|
|||
Net Assets, at value |
$ | 10,280,557 | ||
|
|
|||
Net Assets Consist of |
||||
Paid-in capital |
$ | 10,216,042 | ||
Distributable earnings (loss) |
64,515 | |||
|
|
|||
Net Assets, at value |
$ | 10,280,557 | ||
|
|
|||
Number of Common Shares outstanding |
300,001 | |||
|
|
|||
Net Asset Value |
$ | 34.27 | ||
|
|
|||
Investment in non-affiliated securities at cost |
$ | 9,289,448 | ||
|
|
|||
Value of securities loaned |
$ | 2,598,225 | ||
|
|
|||
Investment in DWS Government Money Market Series at cost |
$ | 74,530 | ||
|
|
|||
Investment in DWS Government & Agency Securities Portfolio at cost* |
$ | 226,111 | ||
|
|
|||
Non-cash collateral for securities on loan |
$ | 2,435,042 | ||
|
|
* | Represents collateral on securities loaned. |
See Notes to Financial Statements. | 63 |
DBX ETF Trust
For the Six Months Ended February 28, 2019 (Unaudited)
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
Xtrackers FTSE Emerging Comprehensive Factor ETF |
Xtrackers Russell 1000 Comprehensive Factor ETF |
Xtrackers Russell 1000 US QARP ETF |
|||||||||||||
Investment Income |
||||||||||||||||
Unaffiliated dividend income* |
$ | 658,238 | $ | 66,922 | $ | 1,618,332 | $ | 824,279 | ||||||||
Income distributions from affiliated funds |
543 | 25 | 9,078 | 895 | ||||||||||||
Unaffiliated non-cash dividend income |
60,348 | | | | ||||||||||||
Affiliated securities lending income |
2,773 | 215 | 3,510 | 1,170 | ||||||||||||
Unaffiliated securities lending income, net of borrower rebates |
| | 4,957 | 121 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total investment income |
721,902 | 67,162 | 1,635,877 | 826,465 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Expenses |
||||||||||||||||
Investment advisory fees |
108,223 | 15,061 | 138,396 | 71,634 | ||||||||||||
Other expenses |
57 | 57 | 57 | 30 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total expenses |
108,280 | 15,118 | 138,453 | 71,664 | ||||||||||||
Less fees waived (see note 3): |
||||||||||||||||
Waiver |
(15 | ) | (2 | ) | (367 | ) | (26 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net expenses |
108,265 | 15,116 | 138,086 | 71,638 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Investment income (loss) |
613,637 | 52,046 | 1,497,791 | 754,827 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Realized and Unrealized Gain (Loss) |
||||||||||||||||
Net realized gain (loss) from: |
||||||||||||||||
Investments |
(1,427,755 | ) | (322,583 | ) | (8,783,794 | ) | (15,975 | ) | ||||||||
In-kind redemptions |
375,384 | | 2,866,750 | (83,541 | ) | |||||||||||
Futures contracts |
(37,597 | ) | (4,285 | ) | (116,060 | ) | | |||||||||
Foreign currency transactions |
(4,326 | ) | (2,475 | ) | | | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net realized gain (loss) |
(1,094,294 | ) | (329,343 | ) | (6,033,104 | ) | (99,516 | ) | ||||||||
Net change in unrealized appreciation (depreciation) on: |
||||||||||||||||
Investments** |
(1,230,416 | ) | 264,134 | (1,154,074 | ) | 66,544 | ||||||||||
Investments in affiliates |
2,295 | | | | ||||||||||||
Futures contracts |
22,135 | 3,820 | (13,115 | ) | 13,518 | |||||||||||
Foreign currency translations |
970 | 2,106 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net change in unrealized appreciation (depreciation) |
(1,205,016 | ) | 270,060 | (1,167,189 | ) | 80,062 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net realized and unrealized gain (loss) on investments, futures and foreign currency transactions |
(2,299,310 | ) | (59,283 | ) | (7,200,293 | ) | (19,454 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | (1,685,673 | ) | $ | (7,237 | ) | $ | (5,702,502 | ) | $ | 735,373 | |||||
|
|
|
|
|
|
|
|
|||||||||
* Unaffiliated foreign tax withheld |
$ | 65,130 | $ | 5,423 | $ | 117 | $ | 11 | ||||||||
** Net of change in deferred foreign taxes |
$ | | $ | (3,551 | ) | $ | | $ | |
See Notes to Financial Statements. | 64 |
DBX ETF Trust
Statements of Operations (Continued)
For the Six Months Ended February 28, 2019 (Unaudited)
Xtrackers Russell 2000 Comprehensive Factor ETF |
||||
Investment Income |
||||
Unaffiliated dividend income* |
$ | 104,060 | ||
Income distributions from affiliated funds |
659 | |||
Affiliated securities lending income |
2,193 | |||
|
|
|||
Total investment income |
106,912 | |||
|
|
|||
Expenses |
||||
Investment advisory fees |
15,037 | |||
Other expenses |
57 | |||
|
|
|||
Total expenses |
15,094 | |||
Less fees waived (see note 3): |
||||
Waiver |
(23 | ) | ||
|
|
|||
Net expenses |
15,071 | |||
|
|
|||
Net Investment income (loss) |
91,841 | |||
|
|
|||
Realized and Unrealized Gain (Loss) |
||||
Net realized gain (loss) from: | ||||
Investments |
(466,323 | ) | ||
Futures contracts |
(17,060 | ) | ||
Foreign currency transactions |
(3 | ) | ||
|
|
|||
Net realized gain (loss) |
(483,386 | ) | ||
Net change in unrealized appreciation (depreciation) on: |
||||
Investments |
(661,402 | ) | ||
Futures contracts |
8,445 | |||
Foreign currency translations |
24 | |||
|
|
|||
Net change in unrealized appreciation (depreciation) |
(652,933 | ) | ||
|
|
|||
Net realized and unrealized gain (loss) on investments, futures and foreign currency transactions |
(1,136,319 | ) | ||
|
|
|||
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | (1,044,478 | ) | |
|
|
|||
* Unaffiliated foreign tax withheld |
$ | 18 |
See Notes to Financial Statements. | 65 |
DBX ETF Trust
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
Xtrackers FTSE Emerging Comprehensive Factor ETF |
|||||||||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
|||||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||||||
Net investment income (loss) |
$ | 613,637 | $ | 1,186,134 | $ | 52,046 | $ | 228,551 | ||||||||
Net realized gain (loss) |
(1,094,294 | ) | 96,967 | (329,343 | ) | 837,875 | ||||||||||
Net change in net unrealized appreciation (depreciation) |
(1,205,016 | ) | (463,370 | ) | 270,060 | (1,468,661 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
(1,685,673 | ) | 819,731 | (7,237 | ) | (402,235 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Distributions to Shareholders |
(751,764 | ) | (1,119,637 | )* | (191,501 | ) | (534,323 | )** | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Fund Shares Transactions |
||||||||||||||||
Proceeds from shares sold |
30,817,665 | 45,367,454 | | | ||||||||||||
Value of shares redeemed |
(5,180,664 | ) | (1,436,896 | ) | | (5,735,711 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from fund share transactions |
25,637,001 | 43,930,558 | | (5,735,711 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net increase (decrease) in Net Assets |
23,199,564 | 43,630,652 | (198,738 | ) | (6,672,269 | ) | ||||||||||
Net Assets |
||||||||||||||||
Beginning of period |
59,126,436 | 15,495,784 | 6,416,481 | 13,088,750 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of period |
$ | 82,326,000 | $ | 59,126,436 | *** | $ | 6,217,743 | $ | 6,416,481 | *** | ||||||
|
|
|
|
|
|
|
|
|||||||||
Changes in Shares Outstanding |
||||||||||||||||
Shares outstanding, beginning of period |
2,050,001 | 550,001 | 250,001 | 450,001 | ||||||||||||
Shares sold |
1,150,000 | 1,550,000 | | | ||||||||||||
Shares redeemed |
(200,000 | ) | (50,000 | ) | | (200,000 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares outstanding, end of period |
3,000,001 | 2,050,001 | 250,001 | 250,001 | ||||||||||||
|
|
|
|
|
|
|
|
* | Includes distributions from net investment income. |
** | Includes distributions from net investment income of $342,332 and net realized gains of $191,991. |
*** | Includes undistributed net investment income of $434,377 and $72,089 respectively. |
See Notes to Financial Statements. | 66 |
DBX ETF Trust
Statements of Changes in Net Assets (Continued)
Xtrackers Russell 1000 Comprehensive Factor ETF |
Xtrackers Russell 1000 US QARP ETF | |||||||||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
For the Six Months Ended February 28, 2019 (Unaudited) |
For the Period April 5, 2018(1) to August 31, 2018 |
|||||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||||||
Net investment income (loss) |
$ | 1,497,791 | $ | 2,300,079 | $ | 754,827 | $ | 415,425 | ||||||||
Net realized gain (loss) |
(6,033,104 | ) | 7,060,292 | (99,516 | ) | 27,083 | ||||||||||
Net change in net unrealized appreciation (depreciation) |
(1,167,189 | ) | 12,374,293 | 80,062 | 3,969,223 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
(5,702,502 | ) | 21,734,664 | 735,373 | 4,411,731 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Distributions to Shareholders |
(1,445,495 | ) | (2,163,877 | )* | (629,493 | ) | (177,934 | )* | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Fund Shares Transactions |
||||||||||||||||
Proceeds from shares sold |
48,776,191 | 104,881,632 | 70,338,320 | 64,987,902 | ||||||||||||
Value of shares redeemed |
(17,294,132 | ) | (53,325,864 | ) | (5,938,233 | ) | (7,807,954 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from fund share transactions |
31,482,059 | 51,555,768 | 64,400,087 | 57,179,948 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net increase (decrease) in Net Assets |
24,334,062 | 71,126,555 | 64,505,967 | 61,413,745 | ||||||||||||
Net Assets |
||||||||||||||||
Beginning of period |
171,338,678 | 100,212,123 | 61,413,770 | 25 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of period |
$ | 195,672,740 | $ | 171,338,678 | ** | $ | 125,919,737 | $ | 61,413,770 | ** | ||||||
|
|
|
|
|
|
|
|
|||||||||
Changes in Shares Outstanding |
||||||||||||||||
Shares outstanding, beginning of period |
5,050,001 | 3,400,001 | 2,250,001 | 1 | ||||||||||||
Shares sold |
1,550,000 | 3,300,000 | 2,800,000 | 2,550,000 | ||||||||||||
Shares redeemed |
(550,000 | ) | (1,650,000 | ) | (250,000 | ) | (300,000 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares outstanding, end of period |
6,050,001 | 5,050,001 | 4,800,001 | 2,250,001 | ||||||||||||
|
|
|
|
|
|
|
|
(1) | Commencement of Operations. |
* | Includes distributions from net investment income. |
** | Includes undistributed net investment income of $471,966 and $237,491 respectively. |
See Notes to Financial Statements. | 67 |
DBX ETF Trust
Statements of Changes in Net Assets (Continued)
Xtrackers Russell 2000 Comprehensive Factor ETF |
||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
|||||||
Increase (Decrease) in Net Assets from Operations |
||||||||
Net investment income (loss) |
$ | 91,841 | $ | 136,931 | ||||
Net realized gain (loss) |
(483,386 | ) | 684,775 | |||||
Net change in net unrealized appreciation (depreciation) |
(652,933 | ) | 1,083,245 | |||||
|
|
|
|
|||||
Net increase (decrease) in net assets resulting from operations |
(1,044,478 | ) | 1,904,951 | |||||
|
|
|
|
|||||
Distributions to Shareholders |
(95,400 | ) | (222,095 | )* | ||||
|
|
|
|
|||||
Fund Shares Transactions |
||||||||
Proceeds from shares sold |
| 10,288,658 | ||||||
Value of shares redeemed |
| (5,225,663 | ) | |||||
|
|
|
|
|||||
Net increase (decrease) in net assets resulting from fund share transactions |
| 5,062,995 | ||||||
|
|
|
|
|||||
Total net increase (decrease) in Net Assets |
(1,139,878 | ) | 6,745,851 | |||||
Net Assets |
||||||||
Beginning of period |
11,420,435 | 4,674,584 | ||||||
|
|
|
|
|||||
End of period |
$ | 10,280,557 | $ | 11,420,435 | ** | |||
|
|
|
|
|||||
Changes in Shares Outstanding |
||||||||
Shares outstanding, beginning of period |
300,001 | 150,001 | ||||||
Shares sold |
| 300,000 | ||||||
Shares redeemed |
| (150,000 | ) | |||||
|
|
|
|
|||||
Shares outstanding, end of period |
300,001 | 300,001 | ||||||
|
|
|
|
* | Includes distributions from net investment income of $115,343 and net realized gains of $106,752. |
** | Includes undistributed net investment income of $34,581. |
See Notes to Financial Statements. | 68 |
DBX ETF Trust
Xtrackers FTSE Developed ex US Comprehensive Factor ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Years Ended August 31, |
Period Ended 8/31/2016(a) |
|||||||||||||
2018 | 2017 | |||||||||||||||
Net Asset Value, beginning of period |
$ | 28.84 | $ | 28.17 | $ | 25.41 | $ | 25.00 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss)(c) |
0.26 | 0.77 | 0.54 | 0.52 | ||||||||||||
Net realized and unrealized gain (loss) |
(1.31 | ) | 0.72 | (d) | 3.19 | (d) | 0.27 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Total from investment operations |
(1.05 | ) | 1.49 | 3.73 | 0.79 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Less distributions from: |
| |||||||||||||||
Net investment income |
(0.35 | ) | (0.82 | ) | (0.97 | ) | (0.38 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total distributions |
(0.35 | ) | (0.82 | ) | (0.97 | ) | (0.38 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Asset Value, end of period |
$ | 27.44 | $ | 28.84 | $ | 28.17 | $ | 25.41 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Return (%) |
(3.66 | )(e)** | 5.32 | 15.16 | 3.21 | ** | ||||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||||||
Net Assets, end of period ($ millions) |
82 | 59 | 15 | 3 | ||||||||||||
Ratio of expenses before fee waiver (%) |
0.35 | * | 0.35 | 0.35 | 0.36 | * | ||||||||||
Ratio of expenses after fee waiver (%) |
0.35 | * | 0.35 | 0.35 | 0.36 | * | ||||||||||
Ratio of net investment income (loss) (%) |
1.98 | * | 2.62 | 2.10 | 2.77 | * | ||||||||||
Portfolio turnover rate (%)(f) |
27 | ** | 45 | 45 | 35 | ** | ||||||||||
Xtrackers FTSE Emerging Comprehensive Factor ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Years Ended August 31, |
Period Ended 8/31/2016(b) |
|||||||||||||
2018 | 2017 | |||||||||||||||
Net Asset Value, beginning of period |
$ | 25.67 | $ | 29.09 | $ | 25.73 | $ | 25.00 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss)(c) |
0.21 | 0.82 | 0.88 | 0.38 | ||||||||||||
Net realized and unrealized gain (loss) |
(0.25 | ) | (2.46 | ) | 3.27 | 0.41 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total from investment operations |
(0.04 | ) | (1.64 | ) | 4.15 | 0.79 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Less distributions from: |
| |||||||||||||||
Net investment income |
(0.32 | ) | (1.01 | ) | (0.61 | ) | (0.06 | ) | ||||||||
Net realized gains |
(0.44 | ) | (0.77 | ) | (0.18 | ) | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Total distributions |
(0.76 | ) | (1.78 | ) | (0.79 | ) | (0.06 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Asset Value, end of period |
$ | 24.87 | $ | 25.67 | $ | 29.09 | $ | 25.73 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Return (%) |
(0.03 | )(e)** | (5.89 | ) | 16.56 | 3.16 | ** | |||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||||||
Net Assets, end of period ($ millions) |
6 | 6 | 13 | 3 | ||||||||||||
Ratio of expenses before fee waiver (%) |
0.50 | * | 0.50 | 0.50 | 0.50 | * | ||||||||||
Ratio of expenses after fee waiver (%) |
0.50 | * | 0.50 | 0.50 | 0.50 | * | ||||||||||
Ratio of net investment income (loss) (%) |
1.73 | * | 2.90 | 3.28 | 4.14 | * | ||||||||||
Portfolio turnover rate (%)(f) |
28 | ** | 74 | 48 | 1 | ** |
(a) | For the period November 24, 2015 (commencement of operations) through August 31, 2016. |
(b) | For the period April 19, 2016 (commencement of operations) through August 31, 2016. |
(c) | Based on average shares outstanding during the period. |
(d) | Because of the timing of subscriptions and redemptions in relation to fluctuating markets at value, the amount shown may not agree with the change in aggregate gains and losses. |
(e) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(f) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 69 |
DBX ETF Trust
Financial Highlights (Continued)
Xtrackers Russell 1000 Comprehensive Factor ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Years Ended August 31, |
Period Ended 8/31/2016(a) |
|||||||||||||
2018 | 2017 | |||||||||||||||
Net Asset Value, beginning of period |
$ | 33.93 | $ | 29.47 | $ | 26.76 | $ | 25.00 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from investment operations: |
||||||||||||||||
Net investment income (loss)(c) |
0.29 | 0.52 | 0.51 | 0.40 | ||||||||||||
Net realized and unrealized gain (loss) |
(1.60 | ) | 4.44 | 2.85 | 1.60 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total from investment operations |
(1.31 | ) | 4.96 | 3.36 | 2.00 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Less distributions from: |
| |||||||||||||||
Net investment income |
(0.28 | ) | (0.50 | ) | (0.65 | ) | (0.24 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total distributions |
(0.28 | ) | (0.50 | ) | (0.65 | ) | (0.24 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Asset Value, end of period |
$ | 32.34 | $ | 33.93 | $ | 29.47 | $ | 26.76 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Return (%) |
(3.82 | )(d)** | 16.97 | (d) | 12.75 | (d) | 8.06 | ** | ||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||||||
Net Assets, end of period ($ millions) |
196 | 171 | 100 | 21 | ||||||||||||
Ratio of expenses before fee waiver (%) |
0.17 | * | 0.19 | 0.23 | 0.25 | * | ||||||||||
Ratio of expenses after fee waiver (%) |
0.17 | * | 0.18 | 0.21 | 0.25 | * | ||||||||||
Ratio of net investment income (loss) (%) |
1.84 | * | 1.62 | 1.83 | 2.01 | * | ||||||||||
Portfolio turnover rate (%)(e) |
20 | ** | 45 | 67 | 64 | ** | ||||||||||
Xtrackers Russell 1000 US QARP ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Period Ended 8/31/2018(b) |
||||||||||||||
Net Asset Value, beginning of period |
$ | 27.29 | $ | 25.00 | ||||||||||||
|
|
|
|
|||||||||||||
Income (loss) from investment operations: |
||||||||||||||||
Net investment income (loss)(c) |
0.25 | 0.21 | ||||||||||||||
Net realized and unrealized gain (loss) |
(1.07 | ) | 2.16 | |||||||||||||
|
|
|
|
|||||||||||||
Total from investment operations |
(0.82 | ) | 2.37 | |||||||||||||
|
|
|
|
|||||||||||||
Less distributions from: |
|
|||||||||||||||
Net investment income |
(0.24 | ) | (0.08 | ) | ||||||||||||
|
|
|
|
|||||||||||||
Total distributions |
(0.24 | ) | (0.08 | ) | ||||||||||||
|
|
|
|
|||||||||||||
Net Asset Value, end of period |
$ | 26.23 | $ | 27.29 | ||||||||||||
|
|
|
|
|||||||||||||
Total Return (%) |
(2.95 | )(d)** | 9.52 | ** | ||||||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||||||
Net Assets, end of period ($ millions) |
126 | 61 | ||||||||||||||
Ratio of expenses before fee waiver (%) |
0.19 | * | 0.19 | * | ||||||||||||
Ratio of expenses after fee waiver (%) |
0.19 | * | 0.19 | * | ||||||||||||
Ratio of net investment income (loss) (%) |
2.00 | * | 2.00 | * | ||||||||||||
Portfolio turnover rate (%)(e) |
1 | ** | 26 | ** |
(a) | For the period November 24, 2015 (commencement of operations) through August 31, 2016. |
(b) | For the period April 5, 2018 (commencement of operations) through August 31, 2018. |
(c) | Based on average shares outstanding during the period. |
(d) | The Total Return would have been lower if certain fees had not been reimbursed by the Advisor. |
(e) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 70 |
DBX ETF Trust
Financial Highlights (Continued)
Xtrackers Russell 2000 Comprehensive Factor ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Years Ended August 31, |
Period Ended 8/31/2016(a) |
|||||||||||||
2018 | 2017 | |||||||||||||||
Net Asset Value, beginning of period |
$ | 38.07 | $ | 31.16 | $ | 27.82 | $ | 25.00 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss)(b) |
0.31 | 0.49 | 0.46 | 0.09 | ||||||||||||
Net realized and unrealized gain (loss) |
(3.79 | ) | 7.23 | 3.35 | 2.73 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total from investment operations |
(3.48 | ) | 7.72 | 3.81 | 2.82 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Less distributions from: |
| |||||||||||||||
Net investment income |
(0.32 | ) | (0.45 | ) | (0.46 | ) | | |||||||||
Net realized gains |
| (0.36 | ) | (0.01 | ) | | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total distributions |
(0.32 | ) | (0.81 | ) | (0.47 | ) | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Asset Value, end of period |
$ | 34.27 | $ | 38.07 | $ | 31.16 | $ | 27.82 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Return (%) |
(9.10 | )(c)** | 25.08 | 13.72 | 11.28 | ** | ||||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||||||
Net Assets, end of period ($ millions) |
10 | 11 | 5 | 3 | ||||||||||||
Ratio of expenses before fee waiver (%) |
0.30 | * | 0.30 | 0.30 | 0.30 | * | ||||||||||
Ratio of expenses after fee waiver (%) |
0.30 | * | 0.30 | 0.30 | 0.30 | * | ||||||||||
Ratio of net investment income (loss) (%) |
1.83 | * | 1.42 | 1.51 | 1.79 | * | ||||||||||
Portfolio turnover rate (%)(d) |
20 | ** | 60 | 53 | 2 | ** |
(a) | For the period June 28, 2016 (commencement of operations) through August 31, 2016. |
(b) | Based on average shares outstanding during the period. |
(c) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(d) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 71 |
DBX ETF Trust
1. Organization
DBX ETF Trust (the Trust) is registered under the Investment Company Act of 1940, as amended (the Act), as an open-end registered management investment company organized as a Delaware statutory trust.
As of February 28, 2019, the Trust consists of thirty-eight investment series of exchange-traded funds (ETFs) (each a Fund and collectively, the Funds) in operation and trading. These financial statements report on the Funds listed below:
Xtrackers FTSE Developed ex US Comprehensive Factor ETF
Xtrackers FTSE Emerging Comprehensive Factor ETF
Xtrackers Russell 1000 Comprehensive Factor ETF
Xtrackers Russell 1000 US QARP ETF
Xtrackers Russell 2000 Comprehensive Factor ETF
DBX Advisors LLC (DBX or the Advisor), an indirect, wholly-owned subsidiary of DWS Group Gmbh & Co. KGaA (DWS Group), serves as investment advisor to the Funds and has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees (Board).
Each Fund offers shares that are listed and traded on the NYSE Arca, Inc. (NYSE Arca). Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value (NAV), only in large specified lots consisting of 50,000 shares, each called a Creation Unit, to authorized participants who have entered into agreements with the Funds distributor. Shares are not individually redeemable securities of the Funds, and owners of the shares may acquire those shares from the Funds, or tender such shares for redemption to the Funds, in Creation Units only.
The investment objective of each Fund is to track the performance, before fees and expenses, of a particular index (the Underlying Index). The underlying indices for the Funds are:
Fund |
Underlying Index | |
Xtrackers FTSE Developed ex US Comprehensive Factor ETF | FTSE Developed ex US Comprehensive Factor Index | |
Xtrackers FTSE Emerging Comprehensive Factor ETF Xtrackers Russell 1000 Comprehensive Factor ETF Xtrackers Russell 1000 US QARP ETF Xtrackers Russell 2000 Comprehensive Factor ETF |
FTSE Emerging Comprehensive Factor Index Russell 1000 Comprehensive Factor Index Russell 1000 2Qual/Val 5% Capped Factor Index Russell 2000 Comprehensive Factor Index |
The FTSE Developed ex US Comprehensive Factor Index is designed to track the equity market performance of companies in developed countries (except the United States) selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the FTSE Developed ex US Index, which is comprised of large- and mid-capitalization equity securities from developed markets (except the United States). The Underlying Index is rebalanced semiannually in March and September after the close of business on the third Friday of the review month.
The FTSE Emerging Comprehensive Factor Index is designed to track the equity market performance of companies in emerging market countries selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the FTSE Emerging Index, which is comprised of large- and mid-cap equity securities from emerging markets. The Underlying Index is rebalanced semiannually in March and September after the close of business on the third Friday of the review month.
The Russell 1000 Comprehensive Factor Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 1000 Index, which is comprised of large-cap equity securities from issuers in the United States. The Underlying Index is rebalanced semiannually in June and December after the close of business on the third Friday of the review month.
The Russell 1000 2Qual/Val 5% Capped Factor Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of quality and value. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 1000 Index, which
72
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
is comprised of large-cap equity securities from issuers in the United States. The Underlying Index is rebalanced annually in June after the close of business on the third Friday of the review month. Upon a rebalancing, no issuer in the Underlying Index may represent more than 5% of the Underlying Index. In the event an issuer represents more than 5% of the Underlying Index at a rebalancing, such amount in excess of 5% shall be reallocated pro-rata to the other issuers in the Underlying Index.
The Russell 2000 Comprehensive Factor Index is designed to track the equity market performance of companies in the United States selected on the investment style criteria (factors) of value, momentum, quality, low volatility and size. The companies eligible for the Underlying Index are derived from its starting universe, the Russell 2000 Index, which is comprised of small-cap equity securities from issuers in the United States. The Underlying Index is rebalanced semiannually in June and December after the close of business on the third Friday of the review month.
Each Fund is entitled to use its respective Underlying Index pursuant to a licensing agreement between the Index Provider and DBX. There is no charge to the Funds in connection with these licensing agreements.
Each Fund, except Xtrackers FTSE Developed ex US Comprehensive Factor ETF and Xtrackers Russell 1000 Comprehensive Factor ETF, is non-diversified and is not limited by the Act with regard to the percentage of its assets that may be invested in the securities of a single issuer. The securities of a particular issuer (or securities of issuers in particular industries) may dominate the Underlying Index of such a fund and, consequently, the funds investment portfolio. This may adversely affect the funds performance or subject the funds shares to greater price volatility than that experienced by more diversified investment companies.
Pursuant to the Trusts organizational documents, the Trusts officers and trustees are indemnified against certain liabilities that may arise out of the performance of their duties to the Funds. Additionally, in the normal course of business the Trust enters into contracts that contain a variety of representations that provide indemnification for certain liabilities. The Trusts maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Trust expects the risk of loss to be remote.
2. Significant Accounting Policies
The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (U.S. GAAP), which require management to make certain estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. Each Fund qualifies as an investment company under Topic 946 of the Accounting Standards Codification of U.S. GAAP. The following is a summary of significant accounting policies followed by the Funds.
In October 2018, the Securities and Exchange Commission adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification, which is intended to facilitate the disclosure of information to investors and simplify compliance without significantly altering the total mix of information provided to investors. Effective with the current reporting period, the Funds adopted the amendments with the impacts being that the Funds are no longer required to present components of distributable earnings on the Statement of Assets and Liabilities or the sources of distributable earnings and the amount of undistributed net investment income on the Statements of Changes in Net Assets.
Security Valuation The NAV of each Funds shares is calculated each business day as of the close of regular trading on the New York Stock Exchange, generally 4:00 p.m. Eastern Time. NAV per share is calculated by dividing a Funds net assets by the number of Fund shares outstanding.
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
Equity securities and ETFs are valued at the most recent sale price or official closing price reported on the exchange (U.S. or foreign) or over-the-counter market on which they trade. Securities for which no sales are
73
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
reported are valued at the calculated mean between the most recent bid and asked quotations on the relevant market or, if a mean cannot be determined, at the most recent bid quotation. Equity securities are generally categorized as Level 1.
Investments in open-end investment companies are valued at their NAV each business day and are categorized as Level 1.
Futures contracts are generally valued at the settlement prices established each day on the exchange on which they are traded and are categorized as Level 1.
Securities and other assets for which market quotations are not readily available or for which the above valuation procedures are deemed not to reflect fair value are valued in a manner that is intended to reflect their fair value as determined in accordance with procedures approved by the Board and are generally categorized as Level 3. In accordance with the Funds valuation procedures, factors considered in determining value may include, but are not limited to, the type of the security; the size of the holding; the initial cost of the security; the existence of any contractual restrictions on the securitys disposition; the price and extent of public trading in similar securities of the issuer or of comparable companies; quotations or evaluated prices from broker-dealers and/or pricing services; information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities); an analysis of the companys or issuers financial statements; an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold; and with respect to debt securities, the maturity, coupon, creditworthiness, currency denomination and the movement of the market in which the security is normally traded. The value determined under these procedures may differ from published values for the same securities.
Fair value pricing could result in a difference between the prices used to calculate a Funds NAV and the prices used by the Funds Underlying Index, which in turn could result in a difference between the Funds performance and the performance of the Funds Underlying Index.
Disclosure about the classification of the fair value measurements is included in a table following the Funds Schedule of Investments.
Cash Cash consists of cash held at banks and is on deposit with major financial institutions.
Investment Transactions and Investment Income Investment transactions are recorded as of the date that the securities are purchased or sold (trade date). Realized gains and losses from the sale or disposition of securities are calculated on the identified cost-method. Dividend income is net of any foreign taxes withheld at source. Certain dividends from foreign securities may be recorded subsequent to the ex-dividend date as soon as the Fund is informed of such dividends. Interest income is recorded on the accrual basis. Distributions received from foreign domiciled corporations, generally determined to be passive foreign investment companies for tax reporting purposes, are included in dividend income.
Tax Information and Dividends and Distributions to Shareholders It is each Funds policy to comply with all requirements of the Internal Revenue Code of 1986, as amended (the Code). Each Fund intends to qualify for and to elect treatment as a separate Regulated Investment Company (RIC) under Subchapter M of the Code. It is the policy of each Fund to pay out dividends from its net investment income, if any, to investors quarterly. Taxable net realized gains from investment transactions, reduced by capital loss carryforwards, if any, are declared and distributed to shareholders at least annually. The capital loss carryforward amount, if any, is available to offset future net capital gains. The Funds may occasionally be required to make supplemental distributions at some other time during the year. The Funds reserve the right to declare special distributions if, in their reasonable discretion, such action is necessary or advisable to preserve the status of each Fund as a RIC or to avoid imposition of income or excise taxes on undistributed income. Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with Federal income tax regulations which may differ from U.S. GAAP. These book/tax differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified at the end of the year within the components of net assets based on their federal tax treatment; temporary differences do not require reclassification. Dividends and distributions, which exceed earnings and profits for the full year for tax purposes, are reported as a tax return of capital.
74
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Funds tax positions taken or expected to be taken on foreign, federal and state income tax returns for all open tax years and has concluded that no provision for income tax is required in the Funds financial statements.
The Funds recognize interest and penalties, if any, related to uncertain tax positions as income tax expense on the Statements of Operations. For the period ended August 31, 2018, the Funds did not incur any interest or penalties.
At August 31, 2018, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by regulations, to offset future capital gains for an unlimited period. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders.
Short-Term | Long-Term | Total Amount | ||||||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 165,066 | $ | 15,877 | $ | 180,943 | ||||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
778,819 | | 778,819 | |||||||||
Xtrackers Russell 2000 Comprehensive Factor ETF |
85,257 | 8,642 | 93,899 |
Capital losses incurred after October 31 (post-October capital losses) and late year ordinary losses incurred after December 31 within the taxable year are deemed to arise on the first business day of each Funds next taxable year. During the period ended August 31, 2018, the Funds incurred and will elect to defer post-October capital losses and late year ordinary losses as follows:
Post-October Losses on Capital |
||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
$ | 2,857,587 | ||
Xtrackers Russell 1000 US QARP ETF |
342,023 | |||
Xtrackers Russell 2000 Comprehensive Factor ETF |
228,622 |
As of August 31, 2018, the aggregate cost of investments for federal income tax purposes, the net unrealized appreciation or (depreciation) and the aggregated gross unrealized appreciation (depreciation) on investments were as follows:
Aggregate Tax Cost |
Net Unrealized Appreciation (Depreciation) |
Aggregate Gross Unrealized Appreciation |
Aggregate Gross Unrealized (Depreciation) |
|||||||||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 59,345,118 | $ | (234,948 | ) | $ | 3,302,210 | $ | (3,537,158 | ) | ||||||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
6,615,750 | (168,038 | ) | 615,117 | (783,155 | ) | ||||||||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
153,937,903 | 15,327,788 | 18,097,094 | (2,769,306 | ) | |||||||||||
Xtrackers Russell 1000 US QARP ETF |
57,442,816 | 3,824,638 | 5,006,729 | (1,182,091 | ) | |||||||||||
Xtrackers Russell 2000 Comprehensive Factor ETF |
10,144,943 | 1,492,357 | 1,730,369 | (238,012 | ) |
The tax character of current year distributions will be determined at the end of the current fiscal year.
Foreign Taxes The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, capital gains on investments, certain foreign currency transactions or other corporate events. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which the Funds invest. These foreign taxes, if any, are paid by the Funds and are reflected in their Statements of Operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on capital gains from sales of investments and foreign currency transactions are included in their respective net realized gain (loss) categories, and deferred foreign taxes on unrealized gains are included in net change in unrealized appreciation (depreciation). Foreign taxes payable as of February 28, 2019, if any, are disclosed in the Funds Statements of Assets and Liabilities.
Foreign Currency Translations The books and records of the Funds are maintained in U.S. dollars. Investment securities and other assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the prevailing exchange rates at year end. Purchases and sales of investment securities, income and expenses are translated into U.S. dollars at the prevailing exchange rates on the respective dates of the transactions.
75
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Net realized and unrealized gains and losses on foreign currency transactions represent net gains and losses between trade and settlement dates on securities transactions, the acquisition and disposition of foreign currencies, and the difference between the amount of net investment income accrued and the U.S. dollar amount actually received. The portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed, but is included with net realized and unrealized gain/appreciation and loss/depreciation on investments.
Securities Lending The Funds may lend securities to certain financial institutions under the terms of their securities lending agreement. During the term of the loans, the Funds continue to receive interest and dividends generated by the securities and to participate in any changes in their market value. The Funds require the borrowers of the securities to maintain collateral with the Funds consisting of cash and/or securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities having a value at least equal to the value of the securities loaned. When the collateral falls below specified amounts, the lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the securities lending agreement. During the period ended February 28, 2019, the Funds invested the cash collateral into a joint trading account in DWS Government & Agency Securities Portfolio, an affiliated money market fund managed by DWS Investment Management Americas, Inc. DWS Investment Management Americas, Inc. receives a management/administration fee (0.11% annualized effective rate as of February 28, 2019) on the cash collateral invested in DWS Government & Agency Securities Portfolio. The Funds receive compensation for lending its securities either in the form of fees or by earning interest on invested cash collateral net of borrower rebates and fees paid to a lending agent. Either the Fund or the borrower may terminate the loan at any time and the borrower, after notice, is required to return borrowed securities within a standard time period. There may be risks of delay and costs in recovery of securities or even loss of rights in the collateral should the borrower of the securities fail financially. If the Funds are not able to recover securities lent, the Funds may sell the collateral and purchase a replacement investment in the market, incurring the risk that the value of the replacement security is greater than the value of the collateral. The Funds are also subject to all investment risks associated with the reinvestment of any cash collateral received, including, but not limited to, interest rate, credit and liquidity risk associated with such investments.
As of February 28, 2019, the Funds listed below had securities on loan, which were classified as Common Stocks in the Schedule of Investments. The value of the related collateral exceeded the value of the securities loaned at period end.
Remaining Contractual Maturity of the Agreements, as of February 28, 2019 |
||||||||||||||||||||
Securities Lending Transactions | Overnight and Continuous |
<30 Days | Between 30 & 90 days |
>90 days | Total | |||||||||||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
|
|||||||||||||||||||
Common Stocks |
$ | 890,630 | $ | | $ | 32,332 | $ | 402,612 | $ | 1,325,574 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 1,325,574 | |||||||||||||||||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
|
|||||||||||||||||||
Common Stocks |
$ | 179,047 | $ | 107 | $ | 79 | $ | 32,562 | $ | 211,795 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 211,795 | |||||||||||||||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
|
|||||||||||||||||||
Common Stocks |
$ | 161,960 | $ | 151,145 | $ | 294,232 | $ | 21,402,793 | $ | 22,010,130 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 22,010,130 | |||||||||||||||||
Xtrackers Russell 1000 US QARP ETF |
|
|||||||||||||||||||
Common Stocks |
$ | 111,047 | $ | 77,379 | $ | 142,129 | $ | 6,494,974 | $ | 6,825,529 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 6,825,529 | |||||||||||||||||
Xtrackers Russell 2000 Comprehensive Factor ETF |
|
|||||||||||||||||||
Common Stocks |
$ | 226,111 | $ | 19,675 | $ | 36,239 | $ | 2,379,128 | $ | 2,661,153 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 2,661,153 |
76
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Derivatives
Futures Contracts Each Fund may enter into futures contracts. These futures contracts will be used to simulate investment in the respective Underlying Index, to facilitate trading or to reduce transaction costs. Each Fund will enter into futures contracts that are traded on a U.S. or non-U.S. exchange. No Fund will use futures for speculative purposes. Futures contracts provide for the future sale by one party and purchase by another party of a specified amount of a specific instrument or index at a specified future time and at a specified price. For the period ended February 28, 2019, Xtrackers FTSE Developed ex US Comprehensive Factor ETF, Xtrackers FTSE Emerging Comprehensive Factor ETF, Xtrackers Russell 1000 Comprehensive Factor ETF, Xtrackers Russell 1000 US QARP ETF and Xtrackers Russell 2000 Comprehensive Factor ETF utilized futures in order to simulate investment in the Underlying Index. To the extent required by law, liquid assets committed to futures contracts will be maintained.
At the time each Fund enters into a futures contract, each Fund deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is affected. Pursuant to the contract, each Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by each Fund as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures contracts is generally less than privately negotiated futures contracts, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, provides a guarantee of performance. The guarantee is supported by a daily payment system (i.e., margin requirements).
Use of long futures contracts subjects each Fund to risk of loss in excess of the amounts shown on the Statement of Assets and Liabilities, up to the notional value of the futures contracts. Use of short futures contracts subjects each Fund to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of a futures contract can vary from the previous days settlement price, which could effectively prevent liquidation of unfavorable positions.
A summary of the open futures contracts as of February 28, 2019 is included in a table following the Funds Schedule of Investments.
The following tables summarize the value of the Funds derivative instruments held as of February 28, 2019 and the related location in the accompanying Statement of Assets and Liabilities, presented by primary underlying risk exposure:
Asset Derivatives |
Liability Derivatives |
|||||||||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF | ||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | 19,990 | Unrealized depreciation on futures contracts* | $ | | ||||||||
Xtrackers Russell 1000 Comprehensive Factor ETF | ||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | 39,988 | Unrealized depreciation on futures contracts* | $ | | ||||||||
Xtrackers Russell 1000 US QARP ETF | ||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | 13,518 | Unrealized depreciation on futures contracts* | $ | | ||||||||
Xtrackers Russell 2000 Comprehensive Factor ETF | ||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | 11,390 | Unrealized depreciation on futures contracts* | $ | |
* | Includes cumulative appreciation or cumulative depreciation of futures contracts as disclosed in the Schedule of Investments. Unsettled variation margin is disclosed separately within the Statement of Assets and Liabilities. |
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Notes to Financial Statements (Unaudited) (Continued)
Additionally, the amount of realized and unrealized gains and losses on derivative instruments recognized in the Funds earnings during the period ended February 28, 2019 and the related location in the accompanying Statement of Operations is summarized in the following tables by primary underlying risk exposure:
Net Realized Gain (Loss) from: |
||||
Futures Contracts Equity Contracts |
||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | (37,597 | ) | |
Xtrackers FTSE Emerging Comprehensive Factor ETF |
(4,285 | ) | ||
Xtrackers Russell 1000 Comprehensive Factor ETF |
(116,060 | ) | ||
Xtrackers Russell 2000 Comprehensive Factor ETF |
(17,060 | ) | ||
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
Futures Contracts Equity Contracts |
||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 22,135 | ||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
3,820 | |||
Xtrackers Russell 1000 Comprehensive Factor ETF |
(13,115 | ) | ||
Xtrackers Russell 1000 US QARP ETF |
13,518 | |||
Xtrackers Russell 2000 Comprehensive Factor ETF |
8,445 |
For the period ended February 28, 2019 the average monthly volume of derivatives was as follows:
Futures Contracts (Contract Value) |
||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 213,596 | ||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
7,535 | |||
Xtrackers Russell 1000 Comprehensive Factor ETF |
1,020,630 | |||
Xtrackers Russell 1000 US QARP ETF |
78,990 | |||
Xtrackers Russell 2000 Comprehensive Factor ETF |
77,947 |
Affiliated Cash Management Vehicles The Funds may invest uninvested cash balances in DWS Government Money Market Series and DWS ESG Liquidity Fund, affiliated money market funds which are managed by DWS Investment Management Americas, Inc. (DIMA), also an indirect, wholly owned subsidiary of DWS Group GmbH & Co. KGaA. Each affiliated money market fund is managed in accordance with Rule 2a-7 under the 1940 Act, which governs the quality, maturity, diversity and liquidity of instruments in which a money market fund may invest. DWS Government Money Market Series seeks to maintain a stable net asset value, and DWS ESG Liquidity Fund maintains a floating net asset value. The Funds indirectly bear their proportionate share of the expenses of each affiliated money market fund in which they invest. The Advisor will waive an amount of the unitary management fee payable to the Advisor by the Funds equal to such acquired funds fees and expenses on the Funds assets invested in the affiliated money market funds.
3. Investment Advisory and Other Agreements
The Advisor has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees. Under an investment advisory agreement between the Trust, on behalf of the Funds, and the Advisor (the Investment Advisory Agreement), the Advisor is responsible for arranging sub-advisory, transfer agency, custody, fund administration, and all other non-distribution related services for the Funds to operate.
For its investment advisory services to the Funds below, the Advisor is entitled to receive a unitary management fee from each Fund based on each Funds average daily net assets, computed and accrued daily and payable monthly, at an annual rate equal to:
Unitary Management Fee |
||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
0.35 | % | ||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
0.50 | % |
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Unitary Management Fee |
||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
0.17 | % | ||
Xtrackers Russell 1000 US QARP ETF |
0.19 | % | ||
Xtrackers Russell 2000 Comprehensive Factor ETF |
0.30 | % |
The Advisor for the Funds below has contractually agreed to waive a portion of its management fees in an amount equal to the acquired funds fees and expenses attributable to the Funds investments in affiliated cash management vehicles. For the period ended February 28, 2019, the Advisor waived expenses of the Funds as follows:
Expenses Waived |
||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 15 | ||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
2 | |||
Xtrackers Russell 1000 Comprehensive Factor ETF |
367 | |||
Xtrackers Russell 1000 US QARP ETF |
26 | |||
Xtrackers Russell 2000 Comprehensive Factor ETF |
23 |
Effective March 5, 2019, the Advisor for Xtrackers FTSE Developed ex US Comprehensive Factor ETF has contractually agreed, until March 5, 2020, to waive a portion of its management fees to the extent necessary to prevent the operating expenses of the Fund from exceeding 0.24% of the Funds average daily net assets.
Out of the unitary management fee, the Advisor pays substantially all expenses of each Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services, and expenses of the Independent Trustees. Each Fund is responsible for the payment of interest expense, taxes, brokerage expenses, distribution fees or expenses, if any, litigation expenses and extraordinary expenses.
The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as Administrator, Custodian, Accounting Agent, Lending Agent and Transfer Agent for each Fund.
ALPS Distributors, Inc. (the Distributor) serves as the distributor of Creation Units for each Fund on an agency basis. The Distributor does not maintain a secondary market in shares of the Funds.
The Board of Trustees is currently comprised of four Trustees, including three Independent Trustees. The Advisor paid retainer fees and attendance fees to each Independent Trustee; retainer fees to the Chairman of the Board of Trustees and Chairman of the Audit Committee; and attendance fees to each member of the Audit Committee (which is comprised of all of the Funds Independent Trustees).
4. Investment Portfolio Transactions
For the period ended February 28, 2019, the cost of investments purchased and proceeds from sale of investments (excluding in-kind transactions and short-term investments) were as follows:
Purchases | Sales | |||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 18,625,054 | $ | 17,336,781 | ||||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
1,733,387 | 1,824,901 | ||||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
34,987,114 | 33,648,277 | ||||||
Xtrackers Russell 1000 US QARP ETF |
513,422 | 742,655 | ||||||
Xtrackers Russell 2000 Comprehensive Factor ETF |
2,025,107 | 2,023,207 |
For the period ended February 28, 2019, the cost of in-kind purchases and proceeds from in-kind sales were as follows:
Purchases | Sales | |||||||
Xtrackers FTSE Developed ex US Comprehensive Factor ETF |
$ | 29,201,704 | $ | 5,020,014 | ||||
Xtrackers Russell 1000 Comprehensive Factor ETF |
48,724,541 | 17,171,682 | ||||||
Xtrackers Russell 1000 US QARP ETF |
70,330,901 | 5,937,790 |
79
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
5. Fund Share Transactions
As of February 28, 2019, there were unlimited Fund shares, no par value, authorized by the Trust. Fund shares are issued and redeemed by each Fund only in Creation Units or multiples thereof. Except when aggregated in Creation Units, shares of each Fund are not redeemable. Transactions in capital shares for each Fund are disclosed in detail in the Statements of Changes in Net Assets. The consideration for the purchase of Creation Units of a Fund generally consists of the in-kind contribution of a designated portfolio of securities constituting a portfolio sampling representation of the securities included in the respective Funds Underlying Index and an amount of cash, which under certain circumstances may include cash in lieu of portfolio securities. Investors purchasing and redeeming Creation Units pay a purchase transaction fee and a redemption transaction fee to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units.
6. Investing in Emerging Markets
The securities of issuers located in emerging markets tend to be more volatile and less liquid than securities of issuers located in more mature economies, and emerging markets generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. The securities of issuers located or doing substantial business in emerging markets are often subject to rapid and large changes in price.
7. Line of Credit
The Trust has entered into a senior unsecured credit facility with a syndication of banks which allows the Xtrackers FTSE Emerging Comprehensive Factor ETF and certain other funds managed by the Advisor to borrow up to $105 million. The Fund may borrow money under this credit facility to the extent necessary for temporary or emergency purposes, including the funding of shareholder redemption requests, trade settlements, and as necessary to distribute to shareholders any income necessary to maintain the Funds status as a regulated investment company. Borrowings are charged an interest rate of 1.25% per annum plus the greater of the Federal Funds Effective Rate or the one-month LIBOR Rate. The Fund may borrow up to the lesser of a pro-rata share of the credit facility at the amount listed below or 33 percent of its net assets as permitted by the Act. The Fund had no outstanding loans at February 28, 2019.
Pro-rata Share | ||||
Xtrackers FTSE Emerging Comprehensive Factor ETF |
$ | 525,000 |
80
DBX ETF Trust
Xtrackers FTSE Developed ex US Comprehensive Factor ETF, Xtrackers FTSE Emerging Comprehensive Factor ETF, Xtrackers Russell 1000 Comprehensive Factor ETF, Xtrackers Russell 1000 US QARP ETF, and Xtrackers Russell 2000 Comprehensive Factor ETF
After discussions at the meeting of the Board of Trustees (Board or Trustees) held on February 11-12, 2019 (the Meeting), the Trustees, including the Independent Trustees (those not affiliated with DBX ETF Trust (the Trust) or its service providers), unanimously approved the continuance of the Investment Advisory Agreement with respect to Xtrackers FTSE Developed ex US Comprehensive Factor ETF, Xtrackers FTSE Emerging Comprehensive Factor ETF, Xtrackers Russell 1000 Comprehensive Factor ETF, Xtrackers Russell 1000 US QARP ETF, and Xtrackers Russell 2000 Comprehensive Factor ETF (each a Fund, and collectively, the Funds). The Independent Trustees were advised throughout the review and Meeting by K&L Gates LLP (Independent Trustee Counsel).
Before reaching their decision to approve the Investment Advisory Agreement for another annual period, the Independent Trustees evaluated the materials furnished to them in advance of the Meeting from DBX Advisors LLC (DBX or the Advisor) for purposes of reviewing the agreements terms and also took into consideration the discussions they had with management during the Meeting and among themselves during their Executive Sessions held on February 11 and February 12, 2019. The Independent Trustees also noted that they had received and should take into consideration a substantial amount of information furnished throughout the year at regular Board meetings, which information included, among other things, an analysis of each Funds investment performance and related financial information, presentations given by DBX, as well as its periodic reports on brokerage commissions, portfolio execution and other services provided to the Funds.
In reaching its decision to continue in effect the Investment Advisory Agreement for another annual period, the Board considered all factors it believed relevant, including (1) the nature, extent and quality of the services provided to the Funds and their shareholders; (2) the financial resources of DBX and its resulting ability to perform its obligations under the Investment Advisory Agreement; (3) the competitiveness of the advisory fee; (4) the total cost of the services provided by and the profits realized by the Advisor from its relationship with the Funds; (5) the extent to which economies of scale have been realized, and if the Funds shareholders have benefitted from those economies; and (6) fall out benefits, if any, enjoyed by the Advisor.
The Board reached a determination, with the assistance of Dechert LLP (Trust Counsel) and through the exercise of its business judgment, that approval of the Investment Advisory Agreement and the compensation to be received thereunder is in the best interests of each Fund and its shareholders as well as consistent with the Boards duties under state and federal law. The Board reached this conclusion based on multiple factors.
Nature, Extent and Quality of Services. The Board reviewed in detail the nature, extent and quality of services provided by the Advisor under the Investment Advisory Agreement. In doing so, the Board considered the information it had received from and the discussions it had with the Advisor continuously during the prior year, in addition to the information the Advisor had provided in response to the Boards requests prior to the Meeting. The Board considered that these services include, among other things, furnishing a continuous investment program for the Funds, including arranging for, or implementing, the purchase and sale of portfolio securities, the provision of general corporate services such as portfolio management compliance services and the preparation and filing of certain reports on behalf of the Trust. The Board also considered, among other things, the professional experience, qualifications and performance of the senior management and key professional personnel of the Advisor, including portfolio management.
The Board considered that the Advisor provides, at its own expense, office facilities and equipment for use by the Funds and supervisory persons responsible for supervising and monitoring the Trusts service providers. The Board also considered that the Advisor pays or arranges for the compensation of officers of the Trust who are also officers or employees of the Advisor or one of its Deutsche Bank affiliates, except as may otherwise be determined by the Board. In addition, the Board considered that the Advisor arranges for the provision of transfer agency, custody, fund administration and accounting, and other non-distribution services necessary for the Funds operations. The Board also considered that in addition to managing the Funds portfolios directly, the Advisor provides oversight of day-to-day operations, including monitoring tracking error, providing services in
81
DBX ETF Trust
Board Considerations in Approval of Investment Advisory Contracts (Unaudited) (Continued)
connection with the creation and redemption of creation units and assistance in meeting legal, compliance and regulatory requirements applicable to the Funds. The Trustees took into consideration that tracking error for each Fund during the year was in an expected range.
Based on its review, the Board concluded that the nature, extent, and quality of services provided by the Advisor under the Investment Advisory Agreement are reasonable and appropriate in relation to the fees paid to the Advisor, taking special consideration of the fact that the advisory fee is a unitary fee and, as a result, a portion of the unitary advisory fee will be used to compensate the Funds service providers. The Board considered the staffing of the Advisor, including the training, qualifications and experience of investment personnel in managing the Funds. The Board also considered the expertise of the Advisor in supervising third party service providers to the Funds, such as the administrator and the custodian, noting the Advisors extensive work with these service providers (including onsite due diligence sessions) to conduct such supervision. The Board further considered the compliance program of the Advisor, which supports the Funds compliance program.
Advisors Financial Resources. In connection with the assessment of the ability of the Advisor to perform its duties under the Investment Advisory Agreement, the Board considered the Advisors financial condition and whether it has the resources necessary to carry out its functions. The Board concluded that the Advisor has the financial resources necessary to perform its obligations under the Investment Advisory Agreement.
Reasonableness of Advisory Fee. The Board compared each Funds advisory fee to that of other pertinent exchange-traded funds (ETFs) and noted that each Funds fee is competitive with the fees of its respective peer group. The Board agreed that it was familiar with the Advisors methodology for selecting each Funds peer group and believed that the Funds peer groups were appropriate. The Board considered that the fee for each of the Funds is a unitary fee pursuant to which the Advisor pays all of the Funds costs (subject to certain specified exceptions). The Board also considered that each Funds portfolio is managed on a day-to-day basis by the Advisor and that the Advisor also provides oversight of day-to-day operations, including monitoring tracking error, providing services in connection with creation and redemption units and assistance in meeting legal and regulatory requirements applicable to the Funds. Based on its review, the Board concluded that the advisory fee for each Fund is reasonable in light of the services provided.
Costs of Services and Profitability. The Board considered the expenses of the Advisor in developing and rendering services provided to the Funds and the information provided by the Advisor to the Board regarding the Funds profitability. The Board considered that the Advisor had provided extensive information about the Advisors profitability and the Advisors methodology in determining profitability. While the Advisor had provided information about the Advisors expenses relating to marketing the Funds, the Board considered the Advisors profitability without accounting for such expenses. The Board determined that, although only some of the Funds were profitable as of this time, the Advisors profitability with respect to each profitable Fund was not excessive. The Board considered whether the Advisor would benefit in other ways from its relationships with the Funds and concluded that there were no material fall-out benefits likely to accrue to the Advisor related to the operation of the Funds.
Economies of Scale. The Board considered that certain Funds had attracted a substantial amount of assets, but determined that those Funds were not experiencing economies of scale beyond what was reflected in each Funds unitary fee, which the Board noted was very competitive. The Board considered that the other Funds were not experiencing economies of scale at this time and determined to revisit this matter after the Funds had attracted more assets.
Given all the information available to it and considering all material factors, the Board concluded that the Investment Advisory Agreement was fair and reasonable and it was unanimously approved.
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DBX ETF Trust
Proxy Voting Policies and Procedures
The Funds policies and procedures for voting proxies for portfolio securities and information about how each Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 are available on our Web site www.Xtrackers.com (click on Resources and Proxy Voting at the top of the page) or on the SECs Web site www.sec.gov. To obtain a written copy of the Funds policies and procedures without charge, upon request, call us toll free at (855) 329-3837.
Quarterly Portfolio Disclosure
The Funds are required to file their complete schedule of portfolio holdings with the SEC for their first and third fiscal quarters on Form N-Q or Form N-PORT (available for filings after March 31, 2019). Copies of the filings are available without charge, upon request on the SECs website at www.sec.gov and are available by calling the Trust at 855-329-3837.
Information about each Funds portfolio holdings is available daily at www.Xtrackers.com.
Discount & Premium Information
Information regarding how often shares of each Fund traded on NYSE Arca at a price above (i.e.,at a premium) or below (i.e., at a discount) the NAV of the Fund can be found at www.Xtrackers.com.
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DBX ETF Trust
DBX Advisors LLC (Advisors) collects non-public information about you from the following sources: (i) information received from you on applications or other forms; and (ii) information about your transactions with the Advisors, Advisors affiliates and third-party service providers and vendors. Advisors does not disclose any non-public personal information about you to anyone, other than as set forth below, as permitted by applicable law and regulation. Advisors may disclose non-public personal information about you to the funds in which you invest, to Advisors affiliates, and to non-affiliated companies that work with Advisors to service your account(s), or to provide services or process transactions that you have requested. Advisors may disclose non-public personal information in situations that may include, but are not limited to, in response to legal and/or regulatory inquiries and the proposed or actual sale, assignment merger or other transfer of all or a portion of Advisors business to another business entity. Advisors may also disclose non-public personal information about you to parties representing you, such as your investment representative, your accountant, your tax advisor, or to other third parties at your direction/consent. Advisors will not sell, rent, license or trade your personal and financial information to or with third parties for their own direct marketing use unless you give us general or specific consent to do so. If you decide to close your account(s) or become an inactive customer, Advisors will adhere to the privacy policies and practices as described in this notice. Advisors restricts access to your personal and account information to those employees who need to know that information to provide products and services to you. Advisors maintains reasonable and customary physical, electronic and procedural safeguards to guard your non-public personal information.
Advisors reserves the right, at their discretion, to change, modify, add, or remove portions of this Privacy Policy Notice, and any of the policies described herein, at any time. Advisors will indicate any such changes to the Privacy Policy Notice at the privacy link which can be found at www.Xtrackers.com. At all times, you are bound by the then-current version of the Privacy Policy and all applicable laws. Advisors highly recommends that you review this Privacy Policy Notice from time to time to ensure that you are familiar with the most recent version. The examples contained in this Privacy Policy Notice are illustrations; they are not intended to be exclusive.
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DBX ETF Trust
This report is intended for the shareholders of the DBX ETF Trust.
This report must be preceded or accompanied by a prospectus.
Investing involves risk, including the possible loss of principal. Stocks may decline in value. With respect to DEEF and DEMG, foreign investing involves greater and different risks than investing in U.S. companies, including currency fluctuations, less liquidity, less developed or less efficient trading markets, lack of comprehensive company information, political instability and differing auditing and legal standards. Further, with respect to DEMG only, emerging markets tend to be more volatile and less liquid than the markets of more mature economies, and generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. Funds concentrating in a single industry (or groups of industries), country or in a limited geographic region to the extent the Underlying Indexes are so concentrated, generally are more volatile than more diversified funds. Additionally, with respect to DESC only, small company stocks tend to be more volatile and less liquid than medium-sized or large company stocks. Because the Funds seek to provide exposure to stocks based on the following multifactors value, momentum, quality, low volatility and size it is expected, exposure to such investment factors will detract from performance in some market environments, as more fully explained in the Funds prospectus. These funds are non-diversified and can take larger positions in fewer issues, increasing their potential risk. Performance of a Fund may diverge from that of its Underlying Index due to operating expenses, transaction costs, cash flows, use of sampling strategies or operational inefficiencies. An investment in any Fund should be considered only as a supplement to a complete investment program for those investors willing to accept the risks associated with that Fund. Please read the prospectus for more information.
Shares of the Funds are bought and sold at market price (not NAV) throughout the day on the NYSE Arca, Inc. Transactions in Fund shares may result in brokerage commissions and may generate tax consequences. There can be no assurance that an active trading market for shares of a Fund will develop or be maintained.
DBX ETF Trust Funds are distributed by ALPS Distributors, Inc. (ALPS). The Funds are managed by DBX Advisors LLC which is not affiliated with ALPS.
The brand DWS represents DWS Group GmbH & Co. KGaA and any of its subsidiaries such as DWS Distributors, Inc. which offers investment products or Deutsche Investment Management Americas Inc. and RREEF America L.L.C. which offer advisory services.
The Funds are not in any way sponsored, endorsed, sold or promoted by the London Stock Exchange Group companies, which include FTSE International Limited (FTSE), Frank Russell Company (Russell), MTS Next Limited (MTS) and FTSE TX Global Debt Capital Markets Inc (FTSE TMX) (together LSEG). LSEG makes no claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to (i) the results to be obtained from the use of each Funds Index, (ii) the figure at which each Funds Index is said to stand at any particular time on any particular day or otherwise, or (iii) the suitability of each Funds Index for the purpose to which it is being put in connection with each Fund. LSEG has not provided nor will it provide any financial or investment advice or recommendation in relation to each Funds Index, to the advisor or to its clients. Each Funds Index is calculated by FTSE, Russell, or its agent. LSEG shall not be (a) liable (whether in negligence or otherwise) to any person for any error in each Funds Index or (b) under any obligation to advise any person of any error therein.
All rights in each Funds Index vest in FTSE. FTSE®, Russell®, MTS®, FTSE TMX® and FTSE Russell, and other service marks and trademarks related to the FTSE or Russell indexes are trademarks of the London Stock Exchange Group companies and are used by FTSE, MTS, FTSE TMX and Russell under license.
Copyright © 2019 DWS Group. All rights reserved. XtrackersTM is a trademark of DWS Investment GmbH. All other trademarks, servicemarks or registered trademarks are the property of their respective owners.
Not FDIC Insured | No Bank Guarantee | May Lose Value
DBX ETF Trust
Investment advisor DBX Advisors LLC 345 Park Avenue New York, NY 10154 |
Administrator, custodian, fund accounting agent, lending agent & transfer agent The Bank of New York Mellon 240 Greenwich Street New York, NY 10286 |
Distributor ALPS Distributors, Inc. 1290 Broadway Suite 1100 Denver, CO 80203 | ||
Independent registered public accounting firm Ernst & Young LLP 5 Times Square New York, NY 10036 |
Legal counsel Dechert LLP 1095 Avenue of the Americas New York, NY 10036 |
R-045855-4 (4/19) DBX003833 (4/20)
February 28, 2019
Semi-Annual Report
DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF (IFIX)
Xtrackers Barclays International Treasury Bond Hedged ETF (IGVT)
Xtrackers High Beta High Yield Bond ETF (HYUP)
Xtrackers Low Beta High Yield Bond ETF (HYDW)
Xtrackers Short Duration High Yield Bond ETF (SHYL)
Xtrackers USD High Yield Corporate Bond ETF (HYLB)
DBX ETF Trust
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Board Considerations in Approval of Investment Advisory Contracts |
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To our Shareholders: (Unaudited)
Dear Shareholder,
We are pleased to provide this semi-annual report on our ETFs tracking the fixed income market for the period ended February 28, 2019.
Global economic activity moderated to its long-term trend during the reporting period, led by a relatively strong U.S., but weakened activity in Europe, China and Japan. Despite previous rate hikes and a weaker global backdrop, the U.S. economy remained on a solid footing backed by strong employment, a patient Federal Reserve Board (FRB) and potential relief around U.S.-China trade tensions. Meanwhile, Eurozone growth slowed, undermined by Germanys poor manufacturing Purchasing Managers Index, auto manufacturing contraction, and civil unrest in France. The region is also prone to a no-deal Brexit becoming more likely given the regions sizeable trade surplus with the U.K. Emerging-market (EM) capital flows were affected by tighter USD funding conditions, while uncertainty on trade talks and country-specific risks added to the woes.
Global equity markets posted positive performance during the reporting period, recovering from losses due to the deep sell-off late in 2018. U.S. equities have also been more resilient than other markets due to tightening liquidity conditions and trade frictions. With the progress on trade talks and resolution of the U.S. government shutdown already baked in, the focus will turn increasingly towards economic growth prospects and their impact on corporate earnings. Meanwhile, major central banks are moving towards a dovish stance owing to the backdrop of rising macro-economic challenges. The FRB raised its key interest rate by .25% and kept the rate unchanged at its December and January meetings, respectively. Although the dot plot was left unchanged this year, the FRB highlighted its data-dependency and caution in terms of further rate hikes. U.S. government debt yields experienced a decline as global growth fears continued to weigh on equity markets and buoyed safe-haven assets.
Although the Eurozone faced headwinds from weak economics and unsettled politics, the economy is likely to improve from strengthening labor markets and the continued accommodative monetary stance. The European Central Bank (ECB) announced the end of net asset purchases and focused its attention on quantitative easing reinvestments. The ECB also signaled keeping its rate low at least through the end of 2019 and revised its growth forecast slightly downward. In addition, European equities trailed the global and U.S. benchmarks due to weaker earnings in Europe relative to the rest of the world. On the other hand, political uncertainty, and concerns over Italian banks, continued to weigh on sovereign spreads. Elsewhere, the Bank of Japan decided to stand pat on monetary policy, to maintain its yield curve control policy and purchase of assets other than long-term Japanese government bonds. The Bank of England decided to stand down on any policy changes towards the end of the period due to uncertainty around an amicable Brexit.
Global risk appetite remains soft as the market frets about slowing growth and U.S.-China trade turbulence. However, favorable employment rates, some acceleration in wage growth, along with fiscal easing should instill confidence in central banks to tighten policy further. That said, we feel major central banks aggregate balance sheets will shrink in 2019, marking a significant shift from quantitative easing to quantitative tightening, which could push yields higher. Given this economic backdrop of a rising rate environment, hedging interest rate exposure would play a significant role in managing investments in fixed income markets.
Our team appreciates your trust and looks forward to serving your investment needs through innovative index-driven strategies.
Sincerely,
/s/ Freddi Klassen
Freddi Klassen
President and Chief Executive Officer
Assumptions, estimates and opinions contained in this document constitute our judgment as of the date of the document and are subject to change without notice. Any projections are based on a number of assumptions as to market conditions and there can be no guarantee that any projected results will be achieved. Past performance is not a guarantee of future results.
1
DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF (IFIX)
The Xtrackers Barclays International Corporate Bond Hedged ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Barclays Global Aggregate Corporate Ex USD Bond Index (USD Hedged) (the Underlying Index). The Underlying Index is designed to track the performance of investment grade corporate debt publicly issued in developed and emerging markets (excluding all securities denominated in U.S. dollars) in the industrial, utility and financial sectors while mitigating exposure to fluctuations between the value of the U.S. dollar and the currencies of the countries included in the Underlying Index. It is not possible to invest directly into an index.
* As a percent of total investments excluding cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 9.
2
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Barclays International Treasury Bond Hedged ETF (IGVT)
The Xtrackers Barclays International Treasury Bond Hedged ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Barclays Global Aggregate Treasury Ex USD Issuer Diversified Bond Index (USD Hedged) (the Underlying Index). The Underlying Index is designed to track the performance of investment grade sovereign debt publicly issued in the developed and emerging markets and denominated in the issuers own domestic currency (excluding all securities denominated in U.S. dollars) while mitigating exposure to fluctuations between the value of the U.S. dollar and the currencies of the countries included in the Underlying Index. It is not possible to invest directly into an index.
* As a percent of total investments excluding cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 14.
3
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers High Beta High Yield Bond ETF (HYUP)
The Xtrackers High Beta High Yield Bond ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market High Beta Index (the Underlying Index). The Underlying Index is designed to track the performance of the segment of the U.S. dollar denominated high yield corporate bond market that exhibits higher overall beta to the broader high yield corporate fixed income market. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 21.
4
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Low Beta High Yield Bond ETF (HYDW)
The Xtrackers Low Beta High Yield Bond ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market Low Beta Index (the Underlying Index). The Underlying Index is designed to track the performance of the segment of the U.S. dollar denominated high yield corporate bond market that exhibits lower overall beta to the broader high yield corporate fixed income market. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 32.
5
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers Short Duration High Yield Bond ETF (SHYL)
The Xtrackers Short Duration High Yield Bond ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market 0-5 Year Index (the Underlying Index). The Underlying Index is designed to track the performance of short-term publicly issued U.S. dollar-denominated below investment grade corporate debt. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 41.
6
DBX ETF Trust
Portfolio Summary (Unaudited)
Xtrackers USD High Yield Corporate Bond ETF (HYLB)
The Xtrackers USD High Yield Corporate Bond ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market Index (the Underlying Index). The Underlying Index is designed to track the performance of a basket of U.S. dollar-denominated high yield liquid corporate bonds. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 50.
7
DBX ETF Trust
As a shareholder of one or more of the Funds, you incur two types of costs: (1) transaction costs, including brokerage commissions paid on purchases and sales of fund shares, and (2) ongoing costs, including management fees and other Fund expenses. In the most recent six-month period the Funds limited these expenses; had they not done so, expenses would have been higher. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The examples in the tables are based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (September 1, 2018 to February 28, 2019).
Actual expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading Expenses Paid During the Period to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds actual expense ratios and an assumed rate of return of 5% per year before expenses (which is not the Funds actual return). The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value September 1, 2018 |
Ending Account Value February 28, 2019 |
Annualized Expense Ratio |
Expenses Paid During the Period Per $1,000(1) |
|||||||||||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
|
|||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,020.10 | 0.30 | % | $ | 1.50 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.31 | 0.30 | % | $ | 1.51 | ||||||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
|
|||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,029.90 | 0.25 | % | $ | 1.26 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.55 | 0.25 | % | $ | 1.25 | ||||||||
Xtrackers High Beta High Yield Bond ETF | ||||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,016.90 | 0.35 | % | $ | 1.75 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.06 | 0.35 | % | $ | 1.76 | ||||||||
Xtrackers Low Beta High Yield Bond ETF | ||||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,030.20 | 0.25 | % | $ | 1.26 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.55 | 0.25 | % | $ | 1.25 | ||||||||
Xtrackers Short Duration High Yield Bond ETF | ||||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,021.30 | 0.20 | % | $ | 1.00 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.80 | 0.20 | % | $ | 1.00 | ||||||||
Xtrackers USD High Yield Corporate Bond ETF | ||||||||||||||||
Actual |
$ | 1,000.00 | $ | 1,023.30 | 0.20 | % | $ | 1.00 | ||||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.80 | 0.20 | % | $ | 1.00 |
(1) Expenses are equal to each Funds annualized expense ratio, multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent six-month period), then divided by 365.
8
DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 9 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Corporate Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 10 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Corporate Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
|
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
|||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.3% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 150,530 | (136,069 | ) | | | 173 | | 14,461 | 14,461 |
(a) | Perpetual, callable security with no stated maturity date. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
DIP: | Debtor In Possession |
DPNT: | Deposit Note |
See Notes to Financial Statements. | 11 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Corporate Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
EMTN: | Euro Medium Term Note |
GMTN: | Global Medium Term Note |
MTN: | Medium Term Note |
REGS: | Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S. persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933. |
As of February 28, 2019, the Fund had the following forward foreign currency contracts outstanding:
Counterparty |
Settlement Date |
Currency To Deliver |
Currency To Receive |
Unrealized Appreciation |
Unrealized Depreciation |
|||||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | AUD | 124,689 | USD | 90,951 | $ | 2,495 | $ | | |||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CAD | 599,670 | USD | 456,811 | 1,060 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CAD | 9,550 | USD | 7,277 | 19 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CHF | 36,600 | USD | 36,988 | 298 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | EUR | 2,990,380 | USD | 3,439,311 | 36,418 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | EUR | 1,500 | USD | 1,725 | 18 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | GBP | 554,051 | USD | 729,851 | | (5,210 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | JPY | 22,020,000 | USD | 202,766 | 5,133 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 88,710 | AUD | 124,689 | | (254 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 462,582 | CAD | 609,220 | 428 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 36,740 | CHF | 36,600 | | (50 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 3,406,854 | EUR | 2,991,880 | | (2,254 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 7,509 | GBP | 5,700 | 53 | | |||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 729,362 | GBP | 548,351 | | (1,863 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 197,808 | JPY | 22,020,000 | | (175 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | AUD | 124,689 | USD | 88,749 | 248 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CAD | 609,220 | USD | 462,909 | | (436 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CHF | 36,600 | USD | 36,840 | 46 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | EUR | 2,991,880 | USD | 3,415,066 | 1,816 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | EUR | 67,850 | USD | 77,453 | 47 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | GBP | 548,351 | USD | 730,431 | 1,799 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | JPY | 22,020,000 | USD | 198,264 | 154 | | |||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||
Total unrealized appreciation (depreciation) |
$ | 50,032 | $ | (10,242 | ) | |||||||||||||||||||||||
|
|
|
|
For information on the Funds policy and additional disclosures regarding forward foreign currency contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
AUD | Australian Dollar |
CAD | Canadian Dollar |
CHF | Swiss Franc |
EUR | Euro |
GBP | Pound Sterling |
JPY | Japanese Yen |
USD | U.S. Dollar |
See Notes to Financial Statements. | 12 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Corporate Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (c) |
$ | | $ | 4,915,189 | $ | | $ | 4,915,189 | ||||||||
Sovereign Bond |
| 18,285 | | 18,285 | ||||||||||||
Short-Term Investments |
14,461 | | | 14,461 | ||||||||||||
Derivatives (d) |
||||||||||||||||
Forward Foreign Currency Contracts |
| 50,032 | | 50,032 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 14,461 | $ | 4,983,506 | $ | | $ | 4,997,967 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Derivatives (d) |
||||||||||||||||
Forward Foreign Currency Contracts |
$ | | $ | (10,242 | ) | $ | | $ | (10,242 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | | $ | (10,242 | ) | $ | | $ | (10,242 | ) | ||||||
|
|
|
|
|
|
|
|
(c) | See Schedule of Investments for additional detailed categorizations. |
(d) | Derivatives include unrealized appreciation (depreciation) on forward foreign currency contracts. |
See Notes to Financial Statements. | 13 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 14 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 15 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 16 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
CASH EQUIVALENTS 2.0% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (a) |
||||||||||||||||||||||||||||||||||||||
| 1,730,177 | (1,529,050 | ) | | | 324 | | 201,127 | 201,127 |
(a) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
OFZ: | Obligatsyi Federalnovo Zaima Federal Loan Obligation |
REGS: | Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S. persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933. |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
See Notes to Financial Statements. | 17 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
As of February 28, 2019, the Fund had the following forward foreign currency contracts outstanding:
Counterparty |
Settlement Date |
Currency To Deliver |
Currency To Receive |
Unrealized Appreciation |
Unrealized Depreciation |
|||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | AUD | 300,715 | USD | 219,348 | $ | 6,016 | $ | | |||||||||||||
The Bank of Nova Scotia |
3/5/2019 | AUD | 304,700 | USD | 216,319 | 160 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CAD | 282,320 | USD | 213,557 | | (1,007 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CAD | 278,167 | USD | 211,900 | 492 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CHF | 44,276 | USD | 44,745 | 361 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CHF | 50,870 | USD | 50,847 | | (147 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | CZK | 574,000 | USD | 25,591 | 114 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | DKK | 432,000 | USD | 66,550 | 659 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | DKK | 338,000 | USD | 51,396 | | (157 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | EUR | 1,767,100 | USD | 2,004,846 | | (6,020 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | EUR | 1,711,194 | USD | 1,968,087 | 20,840 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | GBP | 300,000 | USD | 391,314 | | (6,697 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | GBP | 259,915 | USD | 342,386 | | (2,444 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | HUF | 5,400,000 | USD | 19,636 | 175 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | IDR | 1,221,000,000 | USD | 87,102 | 350 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | IDR | 997,332,318 | USD | 70,608 | | (253 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | ILS | 144,779 | USD | 39,912 | | (46 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | JPY | 654,264 | USD | 6,025 | 153 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | JPY | 131,598,700 | USD | 1,189,518 | 8,401 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | JPY | 129,256,449 | USD | 1,190,229 | 30,134 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | MXN | 1,576,450 | USD | 81,650 | | (45 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | MXN | 1,767,489 | USD | 92,511 | 917 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | MYR | 367,540 | USD | 90,008 | | (365 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | MYR | 346,200 | USD | 84,687 | | (439 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | NOK | 211,800 | USD | 25,174 | 415 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | NZD | 29,400 | USD | 20,403 | 380 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | NZD | 38,400 | USD | 26,187 | 33 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | PLN | 183,200 | USD | 47,953 | | (470 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | PLN | 236,300 | USD | 63,680 | 1,221 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | RUB | 2,639,500 | USD | 40,154 | 148 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | RUB | 2,953,810 | USD | 44,945 | 175 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | SEK | 312,700 | USD | 33,396 | | (474 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | SEK | 417,550 | USD | 46,249 | 1,022 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | SGD | 61,300 | USD | 45,612 | 268 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | SGD | 70,900 | USD | 52,371 | | (74 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | THB | 2,954,700 | USD | 94,570 | 797 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | THB | 2,444,007 | USD | 78,268 | 703 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 430,723 | AUD | 605,415 | | (1,233 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 425,579 | CAD | 560,487 | 394 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 95,509 | CHF | 95,146 | | (131 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 25,515 | CZK | 574,000 | | (38 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 117,516 | DKK | 770,000 | | (72 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 3,960,733 | EUR | 3,478,294 | | (2,620 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 26,099 | GBP | 19,812 | 185 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 718,391 | GBP | 540,103 | | (1,835 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 19,467 | HUF | 5,400,000 | | (6 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 157,664 | IDR | 2,218,332,318 | | (51 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 39,959 | ILS | 144,779 | | (1 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 2,349,168 | JPY | 261,509,413 | | (2,084 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 169,134 | MXN | 3,259,139 | | (240 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 4,438 | MXN | 84,800 | | (44 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 175,452 | MYR | 713,740 | 47 | | |||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 24,782 | NOK | 211,800 | | (24 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 46,206 | NZD | 67,800 | | (29 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 111,023 | PLN | 419,500 | | (141 | ) | ||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 84,881 | RUB | 5,593,310 | | (104 | ) |
See Notes to Financial Statements. | 18 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
Counterparty |
Settlement Date |
Currency To Deliver |
Currency To Receive |
Unrealized Appreciation |
Unrealized Depreciation |
|||||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 79,111 | SEK | 730,250 | $ | | $ | (13 | ) | ||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 97,839 | SGD | 132,200 | | (50 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
3/5/2019 | USD | 170,980 | THB | 5,398,707 | 357 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | AUD | 605,415 | USD | 430,910 | 1,204 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CAD | 560,487 | USD | 425,879 | | (401 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CHF | 95,146 | USD | 95,769 | 120 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CZK | 620,820 | USD | 27,617 | 39 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | CZK | 574,000 | USD | 25,534 | 36 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | DKK | 770,000 | USD | 117,813 | 50 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | EUR | 3,478,294 | USD | 3,970,281 | 2,111 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | EUR | 25,120 | USD | 28,675 | 17 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | GBP | 540,103 | USD | 719,444 | 1,772 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | HUF | 7,095,780 | USD | 25,637 | 7 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | HUF | 5,400,000 | USD | 19,509 | 4 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | ILS | 144,779 | USD | 40,029 | | (5 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | ILS | 107,985 | USD | 29,858 | | (2 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | JPY | 2,306,670 | USD | 20,770 | 17 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | JPY | 261,509,413 | USD | 2,354,583 | 1,824 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | MXN | 3,259,139 | USD | 168,367 | 262 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | MYR | 713,740 | USD | 175,435 | 40 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | NOK | 211,800 | USD | 24,814 | 23 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | NOK | 222,140 | USD | 25,991 | | (10 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | NZD | 67,800 | USD | 46,231 | 26 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | PLN | 419,500 | USD | 111,111 | 126 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | RUB | 5,593,310 | USD | 84,541 | 120 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | SEK | 730,250 | USD | 79,283 | | (4 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | SGD | 132,200 | USD | 97,880 | 43 | | |||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | THB | 5,398,707 | USD | 170,883 | | (563 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/3/2019 | USD | 29,040 | GBP | 21,800 | | (73 | ) | ||||||||||||||||||||
The Bank of Nova Scotia |
4/4/2019 | IDR | 2,218,332,318 | USD | 156,983 | | (146 | ) | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||
Total unrealized appreciation (depreciation) |
$ | 82,758 | $ | (28,558 | ) | |||||||||||||||||||||||
|
|
|
|
For information on the Funds policy and additional disclosures regarding forward foreign currency contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
AUD | Australian Dollar |
CAD | Canadian Dollar |
CHF | Swiss Franc |
CZK | Czech Koruna |
DKK | Danish Krone |
EUR | Euro |
GBP | Pound Sterling |
HUF | Hungarian Forint |
IDR | Indonesian Rupiah |
ILS | Israeli Shekel |
JPY | Japanese Yen |
MXN | Mexican Peso |
MYR | Malaysian Ringgit |
NOK | Norwegian Krone |
NZD | New Zealand Dollar |
PLN | Polish Zloty |
RUB | Russian Ruble |
SEK | Swedish Krona |
SGD | Singapore Dollar |
THB | Thai Baht |
USD | U.S. Dollar |
See Notes to Financial Statements. | 19 |
DBX ETF Trust
Schedule of Investments
Xtrackers Barclays International Treasury Bond Hedged ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (b) |
$ | | $ | 9,768,272 | $ | | $ | 9,768,272 | ||||||||
Short-Term Investments |
201,127 | | | 201,127 | ||||||||||||
Derivatives (c) |
||||||||||||||||
Forward Foreign Currency Contracts |
| 82,758 | | 82,758 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 201,127 | $ | 9,851,030 | $ | | $ | 10,052,157 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Derivatives (c) |
||||||||||||||||
Forward Foreign Currency Contracts |
$ | | $ | (28,558 | ) | $ | | $ | (28,558 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | | $ | (28,558 | ) | $ | | $ | (28,558 | ) | ||||||
|
|
|
|
|
|
|
|
(b) | See Schedule of Investments for additional detailed categorizations. |
(c) | Derivatives include unrealized appreciation (depreciation) on forward foreign currency contracts. |
See Notes to Financial Statements. | 20 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 21 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 22 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 23 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 24 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 25 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 26 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 27 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 28 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 29 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 9.7% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
7,697,440 | 6,563,994 | (d) | | | | 87,274 | | 14,261,434 | 14,261,434 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.5% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 8,078,209 | (7,409,320 | ) | | | 7,589 | | 668,889 | 668,889 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
7,697,440 | 14,642,203 | (7,409,320 | ) | | | 94,863 | | 14,930,323 | 14,930,323 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $14,534,307, which is 9.9% of net assets. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $833,741. |
(d) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
MTN: | Medium Term Note |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
See Notes to Financial Statements. | 30 |
DBX ETF Trust
Schedule of Investments
Xtrackers High Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (e) |
$ | | $ | 143,710,120 | $ | | $ | 143,710,120 | ||||||||
Short-Term Investments (e) |
14,930,323 | | | 14,930,323 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 14,930,323 | $ | 143,710,120 | $ | | $ | 158,640,443 | ||||||||
|
|
|
|
|
|
|
|
(e) | See Schedule of Investments for additional detailed categorizations. |
See Notes to Financial Statements. | 31 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 32 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 33 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 34 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 35 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 36 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 37 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 38 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 1.4% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
2,990,054 | | (989,033 | )(d) | | | 7,497 | | 2,001,021 | 2,001,021 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 1.6% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 10,506,275 | (8,207,915 | ) | | | 16,584 | | 2,298,360 | 2,298,360 | |||||||||||||||||||||||||||||
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|
|
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|
|
|
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|
|
|
|
|
|
|||||||||||||||||||||
2,990,054 | 10,506,275 | (9,196,948 | ) | | | 24,081 | | 4,299,381 | 4,299,381 | |||||||||||||||||||||||||||||
|
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|
|
|
|
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|
|
|
|
|
|
|
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $2,706,437, which is 1.9% of net assets. |
See Notes to Financial Statements. | 39 |
DBX ETF Trust
Schedule of Investments
Xtrackers Low Beta High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $806,301. |
(d) | Represents the net increase (purchases cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
MTN: | Medium Term Note |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (e) |
$ | | $ | 141,226,806 | $ | | $ | 141,226,806 | ||||||||
Short-Term Investments (e) |
4,299,381 | | | 4,299,381 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 4,299,381 | $ | 141,226,806 | $ | | $ | 145,526,187 | ||||||||
|
|
|
|
|
|
|
|
(e) | See Schedule of Investments for additional detailed categorizations. |
See Notes to Financial Statements. | 40 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 41 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 42 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 43 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 44 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 45 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 46 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 47 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 7.3% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares , 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
2,437,670 | 792,203 | (d) | | | | 18,632 | | 3,229,873 | 3,229,873 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 2.0% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares , 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 5,236,599 | (4,335,625 | ) | | | 3,035 | | 900,974 | 900,974 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
2,437,670 | 6,028,802 | (4,335,625 | ) | | | 21,667 | | 4,130,847 | 4,130,847 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $3,537,264, which is 8.0% of net assets. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $435,484. |
(d) | Represents the net increase (purchases cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
MTN: | Medium Term Note |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
See Notes to Financial Statements. | 48 |
DBX ETF Trust
Schedule of Investments
Xtrackers Short Duration High Yield Bond ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (e) |
$ | | $ | 43,061,650 | $ | | $ | 43,061,650 | ||||||||
Short-Term Investments (e) |
4,130,847 | | | 4,130,847 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL |
$ | 4,130,847 | $ | 43,061,650 | $ | | $ | 47,192,497 | ||||||||
|
|
|
|
|
|
|
|
(e) | See Schedule of Investments for additional detailed categorizations. |
See Notes to Financial Statements. | 49 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 50 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 51 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 52 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 53 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 54 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 55 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 56 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 57 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 58 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 59 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 60 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 61 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 62 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 63 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 64 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 65 |
DBX ETF Trust
Schedule of Investments
Xtrackers USD High Yield Corporate Bond ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 8/31/2018 |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 6.0% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares , 2.31% (b)(c) |
||||||||||||||||||||||||||||||||||||||
111,668,629 | 48,159,953 | (d) | | | | 844,008 | | 159,828,582 | 159,828,582 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.9% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares , 2.38% (b) |
||||||||||||||||||||||||||||||||||||||
| 142,119,281 | (118,858,651 | ) | | | 98,368 | | 23,260,630 | 23,260,630 | |||||||||||||||||||||||||||||
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111,668,629 | 190,279,234 | (118,858,651 | ) | | | 942,376 | | 183,089,212 | 183,089,212 | |||||||||||||||||||||||||||||
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(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $167,650,742, which is 6.3% of net assets. |
(b) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(c) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $14,397,588. |
(d) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
MTN: | Medium Term Note |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Corporate Bonds (e) |
$ | | $ | 2,590,887,936 | $ | | $ | 2,590,887,936 | ||||||||
Short-Term Investments (e) |
183,089,212 | | | 183,089,212 | ||||||||||||
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TOTAL |
$ | 183,089,212 | $ | 2,590,887,936 | $ | | $ | 2,773,977,148 | ||||||||
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(e) | See Schedule of Investments for additional detailed categorizations. |
See Notes to Financial Statements. | 66 |
This Page is Intentionally Left Blank
67
DBX ETF Trust
February 28, 2019 (Unaudited)
Xtrackers Barclays International Corporate Bond Hedged ETF |
Xtrackers Barclays International Treasury Bond Hedged ETF |
Xtrackers High Beta High Yield Bond ETF |
Xtrackers Low Beta High Yield Bond ETF |
|||||||||||||
Assets |
||||||||||||||||
Investment in non-affiliated securities at value |
$ | 4,933,474 | $ | 9,768,272 | $ | 143,710,120 | $ | 141,226,806 | ||||||||
Investment in DWS Government Money Market Series |
14,461 | 201,127 | 668,889 | 2,298,360 | ||||||||||||
Investment in DWS Government & Agency Securities Portfolio* |
| | 14,261,434 | 2,001,021 | ||||||||||||
Foreign currency at value |
13,792 | | | | ||||||||||||
Unrealized appreciation on forward foreign currency contracts |
50,032 | 82,758 | | | ||||||||||||
Receivables: | ||||||||||||||||
Investment securities sold |
| 74,011 | 5,971,928 | 4,161,246 | ||||||||||||
Capital shares |
| 1,956 | | | ||||||||||||
Interest |
68,227 | 86,316 | 2,692,734 | 1,986,849 | ||||||||||||
Securities lending income |
| | 13,868 | 936 | ||||||||||||
Foreign tax reclaim |
161 | 1,982 | | | ||||||||||||
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|
|
|
|
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|
|
|||||||||
Total Assets |
$ | 5,080,147 | $ | 10,216,422 | $ | 167,318,973 | $ | 151,675,218 | ||||||||
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|||||||||
Liabilities |
||||||||||||||||
Due to custodian |
$ | | $ | 29 | $ | | $ | | ||||||||
Due to foreign custodian |
| 82,906 | | | ||||||||||||
Payable upon return of securities loaned |
| | 14,261,434 | 2,001,021 | ||||||||||||
Unrealized depreciation on forward foreign currency contracts |
10,242 | 28,558 | | | ||||||||||||
Payables: | ||||||||||||||||
Investment securities purchased |
41,219 | 222,334 | 5,672,318 | 6,134,479 | ||||||||||||
Investment advisory fees |
1,154 | 1,080 | 39,046 | 27,288 | ||||||||||||
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|||||||||
Total Liabilities |
52,615 | 334,907 | 19,972,798 | 8,162,788 | ||||||||||||
|
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|
|||||||||
Net Assets, at value |
$ | 5,027,532 | $ | 9,881,515 | $ | 147,346,175 | $ | 143,512,430 | ||||||||
|
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|
|||||||||
Net Assets Consist of |
||||||||||||||||
Paid-in capital |
$ | 5,009,594 | $ | 9,953,183 | $ | 151,979,020 | $ | 144,466,465 | ||||||||
Distributable earnings (loss) |
17,938 | (71,668 | ) | (4,632,845 | ) | (954,035 | ) | |||||||||
|
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|||||||||
Net Assets, at value |
$ | 5,027,532 | $ | 9,881,515 | $ | 147,346,175 | $ | 143,512,430 | ||||||||
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|||||||||
Number of Common Shares outstanding |
100,001 | 200,001 | 3,050,001 | 2,900,001 | ||||||||||||
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|||||||||
Net Asset Value |
$ | 50.27 | $ | 49.41 | $ | 48.31 | $ | 49.49 | ||||||||
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|||||||||
Investment in non-affiliated securities at cost |
$ | 4,889,373 | $ | 9,775,663 | $ | 147,802,067 | $ | 140,785,795 | ||||||||
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Value of securities loaned |
$ | | $ | | $ | 14,534,307 | $ | 2,706,437 | ||||||||
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Investment in DWS Government Money Market Series at cost |
$ | 14,461 | $ | 201,127 | $ | 668,889 | $ | 2,298,360 | ||||||||
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Investment in DWS Government & Agency Securities Portfolio at cost* |
$ | | $ | | $ | 14,261,434 | $ | 2,001,021 | ||||||||
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Non-cash collateral for securities on loan |
$ | | $ | | $ | 833,741 | $ | 806,301 | ||||||||
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Foreign currency at cost |
$ | 13,662 | $ | (83,387 | ) | $ | | $ | | |||||||
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* | Represents collateral on securities loaned. |
See Notes to Financial Statements. | 68 |
DBX ETF Trust
Statements of Assets and Liabilities (Continued)
February 28, 2019 (Unaudited)
Xtrackers Short Duration High Yield Bond ETF |
Xtrackers USD High Yield Corporate Bond ETF |
|||||||
Assets |
||||||||
Investment in non-affiliated securities at value |
$ | 43,061,650 | $ | 2,590,887,936 | ||||
Investment in DWS Government Money Market Series |
900,974 | 23,260,630 | ||||||
Investment in DWS Government & Agency Securities Portfolio* |
3,229,873 | 159,828,582 | ||||||
Receivables: | ||||||||
Investment securities sold |
528,285 | 63,139,979 | ||||||
Capital shares |
| 12,196,114 | ||||||
Interest |
754,315 | 42,718,777 | ||||||
Securities lending income |
2,805 | 150,263 | ||||||
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|
|
|||||
Total Assets |
$ | 48,477,902 | $ | 2,892,182,281 | ||||
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|||||
Liabilities |
||||||||
Due to custodian |
$ | | $ | 187 | ||||
Payable upon return of securities loaned |
3,229,873 | 159,828,582 | ||||||
Payables: | ||||||||
Investment securities purchased |
830,170 | 86,874,668 | ||||||
Investment advisory fees |
6,732 | 373,352 | ||||||
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|
|||||
Total Liabilities |
4,066,775 | 247,076,789 | ||||||
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|||||
Net Assets, at value |
$ | 44,411,127 | $ | 2,645,105,492 | ||||
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|||||
Net Assets Consist of |
||||||||
Paid-in capital |
$ | 44,948,114 | $ | 2,654,472,079 | ||||
Distributable earnings (loss) |
(536,987 | ) | (9,366,587 | ) | ||||
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|
|||||
Net Assets, at value |
$ | 44,411,127 | $ | 2,645,105,492 | ||||
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|||||
Number of Common Shares outstanding |
900,001 | 53,400,001 | ||||||
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|||||
Net Asset Value |
$ | 49.35 | $ | 49.53 | ||||
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|||||
Investment in non-affiliated securities at cost |
$ | 43,235,983 | $ | 2,599,460,269 | ||||
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|||||
Value of securities loaned |
$ | 3,537,264 | $ | 167,650,742 | ||||
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Investment in DWS Government Money Market Series at cost |
$ | 900,974 | $ | 23,260,630 | ||||
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|||||
Investment in DWS Government & Agency Securities Portfolio at cost* |
$ | 3,229,873 | $ | 159,828,582 | ||||
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|||||
Non-cash collateral for securities on loan |
$ | 435,484 | $ | 14,397,588 | ||||
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* | Represents collateral on securities loaned. |
See Notes to Financial Statements. | 69 |
DBX ETF Trust
For the Six Months Ended February 28, 2019 (Unaudited)
Xtrackers Barclays International Corporate Bond Hedged ETF |
Xtrackers Barclays International Treasury Bond Hedged ETF |
Xtrackers High Beta High Yield Bond ETF |
Xtrackers Low Beta High Yield Bond ETF |
|||||||||||||
Investment Income |
||||||||||||||||
Unaffiliated interest income* |
$ | 33,469 | $ | 28,050 | $ | 5,141,281 | $ | 3,333,376 | ||||||||
Income distributions from affiliated funds |
173 | 324 | 7,589 | 16,584 | ||||||||||||
Affiliated securities lending income |
| | 87,274 | 7,497 | ||||||||||||
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|||||||||
Total Investment Income |
33,642 | 28,374 | 5,236,144 | 3,357,457 | ||||||||||||
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|||||||||
Expenses |
||||||||||||||||
Investment advisory fees |
7,404 | 6,210 | 250,285 | 171,708 | ||||||||||||
Other expenses |
57 | 57 | 299 | 299 | ||||||||||||
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Total expenses |
7,461 | 6,267 | 250,584 | 172,007 | ||||||||||||
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Less fees waived (see note 3): |
||||||||||||||||
Waiver |
(6 | ) | (10 | ) | (275 | ) | (593 | ) | ||||||||
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|||||||||
Net Expenses |
7,455 | 6,257 | 250,309 | 171,414 | ||||||||||||
|
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|
|
|
|||||||||
Net Investment income (loss) |
26,187 | 22,117 | 4,985,835 | 3,186,043 | ||||||||||||
|
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|
|
|
|||||||||
Realized and Unrealized Gain (Loss) |
||||||||||||||||
Net realized gain (loss) from: |
||||||||||||||||
Investments |
(835 | ) | (10,501 | ) | (1,086,372 | ) | (838,045 | ) | ||||||||
Foreign currency transactions |
(2,032 | ) | (464 | ) | | | ||||||||||
Forward foreign currency contracts |
126,548 | 55,842 | | | ||||||||||||
|
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|
|
|
|
|
|
|||||||||
Net realized gain (loss) |
123,681 | 44,877 | (1,086,372 | ) | (838,045 | ) | ||||||||||
Net change in unrealized appreciation (depreciation) on: |
||||||||||||||||
Investments |
(46,005 | ) | 44,981 | (1,491,528 | ) | 1,912,859 | ||||||||||
Foreign currency translations |
1,440 | 1,331 | | | ||||||||||||
Forward foreign currency contracts |
(5,839 | ) | 20,282 | | | |||||||||||
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|
|
|
|||||||||
Net change in unrealized appreciation (depreciation) |
(50,404 | ) | 66,594 | (1,491,528 | ) | 1,912,859 | ||||||||||
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|
|
|||||||||
Net realized and unrealized gain (loss) on investments and foreign currency transactions |
73,277 | 111,471 | (2,577,900 | ) | 1,074,814 | |||||||||||
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|||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | 99,464 | $ | 133,588 | $ | 2,407,935 | $ | 4,260,857 | ||||||||
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* Unaffiliated foreign tax withheld |
$ | 407 | $ | 556 | $ | | $ | |
See Notes to Financial Statements. | 70 |
DBX ETF Trust
Statements of Operations (Continued)
For the Six Months Ended February 28, 2019 (Unaudited)
Xtrackers Short Duration High Yield Bond ETF |
Xtrackers USD High Yield Corporate Bond ETF |
|||||||
Investment Income |
||||||||
Unaffiliated interest income |
$ | 1,301,723 | $ | 62,547,014 | ||||
Income distributions from affiliated funds |
3,035 | 98,368 | ||||||
Affiliated securities lending income |
18,632 | 844,008 | ||||||
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|
|
|||||
Total Investment Income |
1,323,390 | 63,489,390 | ||||||
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|
|
|||||
Expenses |
||||||||
Investment advisory fees |
43,832 | 2,001,391 | ||||||
Other expenses |
43 | 2,142 | ||||||
|
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|
|
|||||
Total expenses |
43,875 | 2,003,533 | ||||||
|
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|
|||||
Less fees waived (see note 3): |
||||||||
Waiver |
(103 | ) | (3,417 | ) | ||||
|
|
|
|
|||||
Net Expenses |
43,772 | 2,000,116 | ||||||
|
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|
|
|||||
Net Investment income (loss) |
1,279,618 | 61,489,274 | ||||||
|
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|
|||||
Realized and Unrealized Gain (Loss) |
||||||||
Net realized gain (loss) from: |
||||||||
Investments |
(350,456 | ) | (7,093,313 | ) | ||||
In-kind redemptions |
(167,334 | ) | (1,028,862 | ) | ||||
|
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|
|
|||||
Net realized gain (loss) |
(517,790 | ) | (8,122,175 | ) | ||||
Net change in unrealized appreciation (depreciation) on: |
||||||||
Investments |
48,425 | 2,667,827 | ||||||
|
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|
|
|||||
Net change in unrealized appreciation (depreciation) |
48,425 | 2,667,827 | ||||||
|
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|
|||||
Net realized and unrealized gain (loss) on investments and foreign currency transactions |
(469,365 | ) | (5,454,348 | ) | ||||
|
|
|
|
|||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | 810,253 | $ | 56,034,926 | ||||
|
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|
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See Notes to Financial Statements. | 71 |
DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF |
Xtrackers Barclays International Treasury Bond Hedged ETF |
|||||||||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
|||||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||||||
Net investment income (loss) |
$ | 26,187 | $ | 38,156 | $ | 22,117 | $ | 33,401 | ||||||||
Net realized gain (loss) |
123,681 | 247,480 | 44,877 | 175,195 | ||||||||||||
Net change in net unrealized appreciation (depreciation) |
(50,404 | ) | (203,014 | ) | 66,594 | (143,716 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
99,464 | 82,622 | 133,588 | 64,880 | ||||||||||||
|
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|||||||||
Distributions to Shareholders |
(82,901 | ) | (113,203 | )* | (102,765 | ) | (63,240 | )* | ||||||||
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|||||||||
Fund Shares Transactions |
||||||||||||||||
Proceeds from shares sold |
| | 4,951,893 | | ||||||||||||
Value of shares redeemed |
| | | | ||||||||||||
|
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|
|
|
|||||||||
Net increase (decrease) in net assets resulting from fund share transactions |
| | 4,951,893 | | ||||||||||||
|
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|
|
|
|
|
|
|||||||||
Total net increase (decrease) in Net Assets |
16,563 | (30,581 | ) | 4,982,716 | 1,640 | |||||||||||
Net Assets |
||||||||||||||||
Beginning of period |
5,010,969 | 5,041,550 | 4,898,799 | 4,897,159 | ||||||||||||
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|
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|
|
|||||||||
End of period |
$ | 5,027,532 | $ | 5,010,969 | ** | $ | 9,881,515 | $ | 4,898,799 | ** | ||||||
|
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|
|
|
|||||||||
Changes in Shares Outstanding |
||||||||||||||||
Shares outstanding, beginning of period |
100,001 | 100,001 | 100,001 | 100,001 | ||||||||||||
Shares sold |
| | 100,000 | | ||||||||||||
Shares redeemed |
| | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares outstanding, end of period |
100,001 | 100,001 | 200,001 | 100,001 | ||||||||||||
|
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|
|
* | Includes distributions from net investment income. |
** | Includes undistributed net investment income of $66,185 and $16,001 respectively. |
See Notes to Financial Statements. | 72 |
DBX ETF Trust
Statements of Changes in Net Assets (Continued)
Xtrackers High Beta High Yield Bond ETF | Xtrackers Low Beta High Yield Bond ETF | |||||||||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
For the Period January 11, 2018(1) to August 31, 2018 |
For the Six Months Ended February 28, 2019 (Unaudited) |
For the Period January 11, 2018(1) to August 31, 2018 |
|||||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||||||
Net investment income (loss) |
$ | 4,985,835 | $ | 5,906,468 | $ | 3,186,043 | $ | 3,668,878 | ||||||||
Net realized gain (loss) |
(1,086,372 | ) | (250,530 | ) | (838,045 | ) | (1,084,231 | ) | ||||||||
Net change in net unrealized appreciation (depreciation) |
(1,491,528 | ) | (2,600,419 | ) | 1,912,859 | (1,471,848 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
2,407,935 | 3,055,519 | 4,260,857 | 1,112,799 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Distributions to Shareholders |
(4,969,597 | ) | (5,126,702 | )* | (3,189,450 | ) | (3,138,241 | )* | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Fund Shares Transactions |
||||||||||||||||
Proceeds from shares sold |
2,394,746 | 149,584,224 | 4,799,209 | 139,667,206 | ||||||||||||
Value of shares redeemed |
| | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from fund share transactions |
2,394,746 | 149,584,224 | 4,799,209 | 139,667,206 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net increase (decrease) in Net Assets |
(166,916 | ) | 147,513,041 | 5,870,616 | 137,641,764 | |||||||||||
Net Assets |
||||||||||||||||
Beginning of period |
147,513,091 | 50 | 137,641,814 | 50 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of period |
$ | 147,346,175 | $ | 147,513,091 | ** | $ | 143,512,430 | $ | 137,641,814 | ** | ||||||
|
|
|
|
|
|
|
|
|||||||||
Changes in Shares Outstanding |
||||||||||||||||
Shares outstanding, beginning of period |
3,000,001 | 1 | 2,800,001 | 1 | ||||||||||||
Shares sold |
50,000 | 3,000,000 | 100,000 | 2,800,000 | ||||||||||||
Shares redeemed |
| | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares outstanding, end of period |
3,050,001 | 3,000,001 | 2,900,001 | 2,800,001 | ||||||||||||
|
|
|
|
|
|
|
|
(1) | Commencement of Operations. |
* | Includes distributions from net investment income. |
** | Includes undistributed net investment income of $779,766 and $530,637 respectively. |
See Notes to Financial Statements. | 73 |
DBX ETF Trust
Statements of Changes in Net Assets (Continued)
Xtrackers Short Duration High Yield Bond ETF |
Xtrackers USD High Yield Corporate Bond ETF |
|||||||||||||||
For the Six Months Ended February 28, 2019 (Unaudited) |
For the Period January 10, 2018(1) to August 31, 2018 |
For the Six Months Ended February 28, 2019 (Unaudited) |
Year Ended August 31, 2018 |
|||||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||||||
Net investment income (loss) |
$ | 1,279,618 | $ | 1,195,352 | $ | 61,489,274 | $ | 52,854,950 | ||||||||
Net realized gain (loss) |
(517,790 | ) | (64,402 | ) | (8,122,175 | ) | (1,691,911 | ) | ||||||||
Net change in net unrealized appreciation (depreciation) |
48,425 | (222,758 | ) | 2,667,827 | (13,361,568 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from operations |
810,253 | 908,192 | 56,034,926 | 37,801,471 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Distributions to Shareholders |
(1,238,175 | ) | (1,017,257 | )* | (59,247,471 | ) | (45,466,199 | )* | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Fund Shares Transactions |
||||||||||||||||
Proceeds from shares sold |
9,805,392 | 39,864,822 | 1,854,616,467 | 1,813,276,805 | ||||||||||||
Value of shares redeemed |
(4,722,150 | ) | | (1,001,916,471 | ) | (230,205,552 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) in net assets resulting from fund share transactions |
5,083,242 | 39,864,822 | 852,699,996 | 1,583,071,253 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net increase (decrease) in Net Assets |
4,655,320 | 39,755,757 | 849,487,451 | 1,575,406,525 | ||||||||||||
Net Assets |
||||||||||||||||
Beginning of period |
39,755,807 | 50 | 1,795,618,041 | 220,211,516 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
End of period |
$ | 44,411,127 | $ | 39,755,807 | ** | $ | 2,645,105,492 | $ | 1,795,618,041 | ** | ||||||
|
|
|
|
|
|
|
|
|||||||||
Changes in Shares Outstanding |
||||||||||||||||
Shares outstanding, beginning of period |
800,001 | 1 | 36,000,001 | 4,300,001 | ||||||||||||
Shares sold |
200,000 | 800,000 | 38,050,000 | 36,350,000 | ||||||||||||
Shares redeemed |
(100,000 | ) | | (20,650,000 | ) | (4,650,000 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares outstanding, end of period |
900,001 | 800,001 | 53,400,001 | 36,000,001 | ||||||||||||
|
|
|
|
|
|
|
|
(1) | Commencement of Operations. |
* | Includes distributions from net investment income. |
** | Includes undistributed net investment income of $178,095 and $8,479,077 respectively. |
See Notes to Financial Statements. | 74 |
DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Year Ended 8/31/2018 |
Period Ended 8/31/2017(a) |
|||||||||
Net Asset Value, beginning of period |
$ | 50.11 | $ | 50.42 | $ | 50.00 | ||||||
|
|
|
|
|
|
|||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss)(b) |
0.26 | 0.38 | 0.43 | |||||||||
Net realized and unrealized gain (loss) |
0.73 | 0.44 | 0.91 | |||||||||
|
|
|
|
|
|
|||||||
Total from investment operations |
0.99 | 0.82 | 1.34 | |||||||||
|
|
|
|
|
|
|||||||
Less distributions from: | ||||||||||||
Net investment income |
(0.83 | ) | (1.13 | ) | (0.92 | ) | ||||||
|
|
|
|
|
|
|||||||
Total distributions |
(0.83 | ) | (1.13 | ) | (0.92 | ) | ||||||
|
|
|
|
|
|
|||||||
Net Asset Value, end of period |
$ | 50.27 | $ | 50.11 | $ | 50.42 | ||||||
|
|
|
|
|
|
|||||||
Total Return (%) |
2.01 | (c)** | 1.65 | 2.72 | ** | |||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||
Net Assets, end of period ($ millions) |
5 | 5 | 5 | |||||||||
Ratio of expenses before fee waiver (%) |
0.30 | * | 0.30 | 0.30 | * | |||||||
Ratio of expenses after fee waiver (%) |
0.30 | * | 0.30 | 0.30 | * | |||||||
Ratio of net investment income (loss) (%) |
1.05 | * | 0.76 | 1.01 | * | |||||||
Portfolio turnover rate (%)(d) |
17 | ** | 28 | 36 | ** | |||||||
Xtrackers Barclays International Treasury Bond Hedged ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Year Ended 8/31/2018 |
Period Ended 8/31/2017(a) |
|||||||||
Net Asset Value, beginning of period |
$ | 48.99 | $ | 48.97 | $ | 50.00 | ||||||
|
|
|
|
|
|
|||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss)(b) |
0.21 | 0.33 | 0.25 | |||||||||
Net realized and unrealized gain (loss) |
1.24 | 0.32 | (0.40 | ) | ||||||||
|
|
|
|
|
|
|||||||
Total from investment operations |
1.45 | 0.65 | (0.15 | ) | ||||||||
|
|
|
|
|
|
|||||||
Less distributions from: | ||||||||||||
Net investment income |
(0.26 | ) | (0.63 | ) | (0.88 | ) | ||||||
Net realized gains |
(0.77 | ) | | | ||||||||
|
|
|
|
|
|
|||||||
Total distributions |
(1.03 | ) | (0.63 | ) | (0.88 | ) | ||||||
|
|
|
|
|
|
|||||||
Net Asset Value, end of period |
$ | 49.41 | $ | 48.99 | $ | 48.97 | ||||||
|
|
|
|
|
|
|||||||
Total Return (%) |
2.99 | (c)** | 1.34 | (0.27 | )(e)** | |||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||
Net Assets, end of period ($ millions) |
10 | 5 | 5 | |||||||||
Ratio of expenses before fee waiver (%) |
0.25 | * | 0.25 | 0.25 | * | |||||||
Ratio of expenses after fee waiver (%) |
0.25 | * | 0.25 | 0.25 | * | |||||||
Ratio of net investment income (loss) (%) |
0.90 | * | 0.68 | 0.60 | * | |||||||
Portfolio turnover rate (%)(d) |
12 | ** | 31 | 44 | ** |
(a) | For the period October 25, 2016 (commencement of operations) through August 31, 2017. |
(b) | Based on average shares outstanding during the period. |
(c) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(d) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
(e) | The Funds total return includes a reimbursement by the Advisor for a realized loss on a trade executed incorrectly, which otherwise would have reduced total return by 0.03%. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 75 |
DBX ETF Trust
Financial Highlights (Continued)
Xtrackers High Beta High Yield Bond ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Period Ended 8/31/2018(a) |
||||||
Net Asset Value, beginning of period |
$ | 49.17 | $ | 50.00 | ||||
|
|
|
|
|||||
Income (loss) from investment operations: | ||||||||
Net investment income (loss)(b) |
1.64 | 2.07 | ||||||
Net realized and unrealized gain (loss) |
(0.86 | ) | (1.11 | ) | ||||
|
|
|
|
|||||
Total from investment operations |
0.78 | 0.96 | ||||||
|
|
|
|
|||||
Less distributions from: | ||||||||
Net investment income |
(1.64 | ) | (1.79 | ) | ||||
|
|
|
|
|||||
Total distributions |
(1.64 | ) | (1.79 | ) | ||||
|
|
|
|
|||||
Net Asset Value, end of period |
$ | 48.31 | $ | 49.17 | ||||
|
|
|
|
|||||
Total Return (%) |
1.69 | (c)** | 2.01 | ** | ||||
Ratios to Average Net Assets and Supplemental Data |
||||||||
Net Assets, end of period ($ millions) |
147 | 148 | ||||||
Ratio of expenses before fee waiver (%) |
0.35 | * | 0.35 | * | ||||
Ratio of expenses after fee waiver (%) |
0.35 | * | 0.35 | * | ||||
Ratio of net investment income (loss) (%) |
6.97 | * | 6.71 | * | ||||
Portfolio turnover rate (%)(d) |
22 | ** | 34 | ** | ||||
Xtrackers Low Beta High Yield Bond ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Period Ended 8/31/2018(a) |
||||||
Net Asset Value, beginning of period |
$ | 49.16 | $ | 50.00 | ||||
|
|
|
|
|||||
Income (loss) from investment operations: | ||||||||
Net investment income (loss)(b) |
1.12 | 1.37 | ||||||
Net realized and unrealized gain (loss) |
0.33 | (1.05 | ) | |||||
|
|
|
|
|||||
Total from investment operations |
1.45 | 0.32 | ||||||
|
|
|
|
|||||
Less distributions from: | ||||||||
Net investment income |
(1.12 | ) | (1.16 | ) | ||||
|
|
|
|
|||||
Total distributions |
(1.12 | ) | (1.16 | ) | ||||
|
|
|
|
|||||
Net Asset Value, end of period |
$ | 49.49 | $ | 49.16 | ||||
|
|
|
|
|||||
Total Return (%) |
3.02 | (c)** | 0.68 | ** | ||||
Ratios to Average Net Assets and Supplemental Data |
||||||||
Net Assets, end of period ($ millions) |
144 | 138 | ||||||
Ratio of expenses before fee waiver (%) |
0.25 | * | 0.25 | * | ||||
Ratio of expenses after fee waiver (%) |
0.25 | * | 0.25 | * | ||||
Ratio of net investment income (loss) (%) |
4.64 | * | 4.44 | * | ||||
Portfolio turnover rate (%)(d) |
27 | ** | 52 | ** |
(a) | For the period January 11, 2018 (commencement of operations) through August 31, 2018. |
(b) | Based on average shares outstanding during the period. |
(c) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(d) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 76 |
DBX ETF Trust
Financial Highlights (Continued)
Xtrackers Short Duration High Yield Bond ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Period Ended 8/31/2018(a) |
||||||||||
Net Asset Value, beginning of period |
$ | 49.69 | $ | 50.00 | ||||||||
|
|
|
|
|||||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss)(c) |
1.41 | 1.76 | ||||||||||
Net realized and unrealized gain (loss) |
(0.39 | ) | (0.59 | ) | ||||||||
|
|
|
|
|||||||||
Total from investment operations |
1.02 | 1.17 | ||||||||||
|
|
|
|
|||||||||
Less distributions from: | ||||||||||||
Net investment income |
(1.36 | ) | (1.48 | ) | ||||||||
|
|
|
|
|||||||||
Total distributions |
(1.36 | ) | (1.48 | ) | ||||||||
|
|
|
|
|||||||||
Net Asset Value, end of period |
$ | 49.35 | $ | 49.69 | ||||||||
|
|
|
|
|||||||||
Total Return (%) |
2.13 | (d)** | 2.41 | ** | ||||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||
Net Assets, end of period ($ millions) |
44 | 40 | ||||||||||
Ratio of expenses before fee waiver (%) |
0.20 | * | 0.20 | * | ||||||||
Ratio of expenses after fee waiver (%) |
0.20 | * | 0.20 | * | ||||||||
Ratio of net investment income (loss) (%) |
5.84 | * | 5.56 | * | ||||||||
Portfolio turnover rate (%)(e) |
22 | ** | 37 | ** | ||||||||
Xtrackers USD High Yield Corporate Bond ETF Selected Per Share Data |
For the Six Months Ended 2/28/2019 (Unaudited) |
Year Ended 8/31/2018 |
Period Ended 8/31/2017(b) |
|||||||||
Net Asset Value, beginning of period |
$ | 49.88 | $ | 51.21 | $ | 50.00 | ||||||
|
|
|
|
|
|
|||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss)(c) |
1.48 | 2.89 | 2.07 | |||||||||
Net realized and unrealized gain (loss) |
(0.36 | ) | (1.53 | ) | 1.11 | |||||||
|
|
|
|
|
|
|||||||
Total from investment operations |
1.12 | 1.36 | 3.18 | |||||||||
|
|
|
|
|
|
|||||||
Less distributions from: | ||||||||||||
Net investment income |
(1.47 | ) | (2.69 | ) | (1.97 | ) | ||||||
|
|
|
|
|
|
|||||||
Total distributions |
(1.47 | ) | (2.69 | ) | (1.97 | ) | ||||||
|
|
|
|
|
|
|||||||
Net Asset Value, end of period |
$ | 49.53 | $ | 49.88 | $ | 51.21 | ||||||
|
|
|
|
|
|
|||||||
Total Return (%) |
2.33 | (d)** | 2.76 | (d) | 6.43 | ** | ||||||
Ratios to Average Net Assets and Supplemental Data |
||||||||||||
Net Assets, end of period ($ millions) |
2,645 | 1,796 | 220 | |||||||||
Ratio of expenses before fee waiver (%) |
0.20 | * | 0.20 | 0.25 | * | |||||||
Ratio of expenses after fee waiver (%) |
0.20 | * | 0.20 | 0.25 | * | |||||||
Ratio of net investment income (loss) (%) |
6.14 | * | 5.86 | 5.57 | * | |||||||
Portfolio turnover rate (%)(e) |
12 | ** | 32 | 36 | ** |
(a) | For the period January 10, 2018 (commencement of operations) through August 31, 2018. |
(b) | For the period December 7, 2016 (commencement of operations) through August 31, 2017. |
(c) | Based on average shares outstanding during the period. |
(d) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(e) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 77 |
DBX ETF Trust
1. Organization
DBX ETF Trust (the Trust) is registered under the Investment Company Act of 1940, as amended (the Act), as an open-end registered management investment company organized as a Delaware statutory trust.
As of February 28, 2019, the Trust consists of thirty-eight investment series of exchange-traded funds (ETFs) (each a Fund and collectively, the Funds) in operation and trading. These financial statements report on the Funds listed below:
Xtrackers Barclays International Corporate Bond Hedged ETF
Xtrackers Barclays International Treasury Bond Hedged ETF
Xtrackers High Beta High Yield Bond ETF
Xtrackers Low Beta High Yield Bond ETF
Xtrackers Short Duration High Yield Bond ETF
Xtrackers USD High Yield Corporate Bond ETF
DBX Advisors LLC (DBX or the Advisor), an indirect, wholly-owned subsidiary of DWS Group Gmbh & Co. KGaA (DWS Group), serves as investment advisor to the Funds and has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees (Board).
Xtrackers Barclays International Corporate Bond Hedged ETF and Xtrackers Barclays International Treasury Bond Hedged ETF offer shares that are listed and traded on the Cboe BZX Exchange, Inc. (Cboe). Xtrackers High Beta High Yield Bond ETF, Xtrackers Low Beta High Yield Bond ETF, Xtrackers Short Duration High Yield Bond ETF and Xtrackers USD High Yield Corporate Bond ETF offer shares that are listed and traded on the NYSE Arca, Inc. (NYSE Arca). Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value (NAV), only in large specified lots consisting of 50,000 shares, each called a Creation Unit, to authorized participants who have entered into agreements with the Funds distributor. Shares are not individually redeemable securities of the Funds, and owners of the shares may acquire those shares from the Funds, or tender such shares for redemption to the Funds, in Creation Units only.
The investment objective of each Fund is to track the performance, before fees and expenses, of a particular index (the Underlying Index). The underlying indices for the Funds are:
Fund |
Underlying Index | |
Xtrackers Barclays International Corporate Bond Hedged ETF | Barclays Global Aggregate Corporate Ex USD Bond Index (USD Hedged) | |
Xtrackers Barclays International Treasury Bond Hedged ETF | Barclays Global Aggregate Treasury Ex USD Issuer Diversified Bond Index (USD Hedged) | |
Xtrackers High Beta High Yield Bond ETF | Solactive USD High Yield Corporates Total Market High Beta Index | |
Xtrackers Low Beta High Yield Bond ETF | Solactive USD High Yield Corporates Total Market Low Beta Index | |
Xtrackers Short Duration High Yield Bond ETF | Solactive USD High Yield Corporates Total Market 0-5 Year Index | |
Xtrackers USD High Yield Corporate Bond ETF | Solactive USD High Yield Corporates Total Market Index |
The Barclays Global Aggregate Corporate Ex USD Bond Index (USD Hedged) is designed to track the performance of investment grade corporate debt publicly issued in developed and emerging markets (excluding all securities denominated in U.S. dollars) in the industrial, utility and financial sectors while mitigating exposure to fluctuations between the value of the U.S. dollar and the currencies of the countries included in the Underlying Index. The Barclays Global Aggregate Treasury Ex USD Issuer Diversified Bond Index (USD Hedged) is designed to track the performance of investment grade sovereign debt publicly issued in the developed and emerging markets and denominated in the issuers own domestic currency (excluding all securities denominated in U.S. dollars) while mitigating exposure to fluctuations between the value of the U.S. dollar and the currencies of the countries included in the Underlying Index. The Barclays Hedged Indices are rebalanced monthly on the last trading day of the month, when the index will reflect the effect of rolling into new 1-month forward contracts based on the newly determined weights of currency to be sold for the next months index calculation. The
78
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
currency weights are determined as of the last calendar day of the preceding month. This means that no changes in the weights are made during the month to account for changes in the Underlying Index due to price movement of constituent securities. With respect to the bond components of the Underlying Index, the Underlying Index is rebalanced on the last calendar day of the month. No changes are made to constituent holdings other than on month end rebalancing dates.
The Solactive USD High Yield Corporates Total Market High Beta Index is designed to track the performance of the segment of the U.S. dollar denominated high yield corporate bond market that exhibits higher overall beta to the broader high yield corporate fixed income market. The Solactive USD High Yield Corporates Total Market Low Beta Index is designed to track the performance of the segment of the U.S. dollar-denominated high yield corporate bond market that exhibits lower overall beta to the broader high yield corporate fixed income market. The Solactive USD High Yield Corporates Total Market 0-5 Year Index is designed to track the performance of short-term publicly issued U.S. dollar-denominated below investment grade corporate debt. The Solactive USD High Yield Corporates Total Market Index is designed to track the performance of a basket of U.S. dollar-denominated high yield liquid corporate bonds. The Solactive Indexes are rebalanced monthly on the last business day of each month.
Each Fund is entitled to use its respective Underlying Index pursuant to a licensing agreement between the Index Provider and DBX. There is no charge to the Funds in connection with these licensing agreements.
Each Fund is non-diversified and is not limited by the Act with regard to the percentage of its assets that may be invested in the securities of a single issuer. The securities of a particular issuer (or securities of issuers in particular industries) may dominate the Underlying Index of such a fund and, consequently, the funds investment portfolio. This may adversely affect the funds performance or subject the funds shares to greater price volatility than that experienced by more diversified investment companies.
Pursuant to the Trusts organizational documents, the Trusts officers and trustees are indemnified against certain liabilities that may arise out of the performance of their duties to the Funds. Additionally, in the normal course of business the Trust enters into contracts that contain a variety of representations that provide indemnification for certain liabilities. The Trusts maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Trust expects the risk of loss to be remote.
2. Significant Accounting Policies
The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (U.S. GAAP), which require management to make certain estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. Each Fund qualifies as an investment company under Topic 946 of the Accounting Standards Codification of U.S. GAAP. The following is a summary of significant accounting policies followed by the Funds.
In October 2018, the Securities and Exchange Commission adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification, which is intended to facilitate the disclosure of information to investors and simplify compliance without significantly altering the total mix of information provided to investors. Effective with the current reporting period, the Funds adopted the amendments with the impacts being that the Funds are no longer required to present components of distributable earnings on the Statement of Assets and Liabilities or the sources of distributable earnings and the amount of undistributed net investment income on the Statements of Changes in Net Assets.
Security Valuation The NAV, of each Funds shares is calculated each business day as of the close of regular trading on the New York Stock Exchange, generally 4:00 p.m. Eastern Time. NAV per share is calculated by dividing a Funds net assets by the number of Fund shares outstanding.
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in
79
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
Corporate and sovereign debt securities are valued at prices supplied by independent pricing services approved by the Funds Board. Such services may use various pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data, as well as broker quotes. If the pricing services are unable to provide valuations, securities are valued at the mean between the bid and ask quotations or evaluated prices, as applicable, obtained from broker dealers. These securities are generally categorized as Level 2.
Investments in open-end investment companies are valued at their NAV each business day and are categorized as Level 1.
Forward currency contracts are valued at the prevailing forward exchange rate of the underlying currencies and are categorized as Level 2.
Securities and other assets for which market quotations are not readily available or for which the above valuation procedures are deemed not to reflect fair value are valued in a manner that is intended to reflect their fair value as determined in accordance with procedures approved by the Board and are generally categorized as Level 3. In accordance with the Funds valuation procedures, factors considered in determining value may include, but are not limited to, the type of the security; the size of the holding; the initial cost of the security; the existence of any contractual restrictions on the securitys disposition; the price and extent of public trading in similar securities of the issuer or of comparable companies; quotations or evaluated prices from broker-dealers and/or pricing services; information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities); an analysis of the companys or issuers financial statements; an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold; length of time of a halt in trading of the security; movement in the securitys proxy index; and with respect to debt securities, the maturity, coupon, creditworthiness, currency denomination and the movement of the market in which the security is normally traded. The value determined under these procedures may differ from published values for the same securities.
Fair value pricing could result in a difference between the prices used to calculate a Funds NAV and the prices used by the Funds Underlying Index, which in turn could result in a difference between the Funds performance and the performance of the Funds Underlying Index.
Disclosure about the classification of the fair value measurements is included in a table following the Funds Schedule of Investments.
Cash Cash consists of cash held at banks and is on deposit with major financial institutions.
Investment Transactions and Investment Income Investment transactions are recorded as of the date that the securities are purchased or sold (trade date). Realized gains and losses from the sale or disposition of securities are calculated on the identified cost-method. Interest income is recorded on the accrual basis. All premiums and discounts are amortized/accreted for both tax and financial reporting purposes.
Accounting Standard Update In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update 2017-08, Receivables-Nonrefundable fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities which amends the amortization period for certain purchased callable debt securities. Under the new guidance, premium amortization of purchased callable debt securities that have explicit, non-contingent call features and are callable at fixed prices will be amortized to the earliest call date. The guidance will be applied on a modified retrospective basis and is effective for fiscal years, and their interim periods, beginning after December 15, 2018. Management is currently evaluating the impact of this guidance to the Funds.
Tax Information and Dividends and Distributions to Shareholders It is each Funds policy to comply with all requirements of the Internal Revenue Code of 1986, as amended (the Code). Each Fund intends to qualify for and to elect treatment as a separate Regulated Investment Company (RIC) under Subchapter M of the Code. It is the policy of each Fund to pay out dividends from its net investment income, if any, to investors monthly. Taxable net realized gains from investment transactions, reduced by capital loss carryforwards, if any, are declared and
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
distributed to shareholders at least annually. The capital loss carryforward amount, if any, is available to offset future net capital gains. The Funds may occasionally be required to make supplemental distributions at some other time during the year. The Funds reserve the right to declare special distributions if, in their reasonable discretion, such action is necessary or advisable to preserve the status of each Fund as a RIC or to avoid imposition of income or excise taxes on undistributed income. Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with Federal income tax regulations which may differ from U.S. GAAP. These book/tax differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified at the end of the year within the components of net assets based on their federal tax treatment; temporary differences do not require reclassification. Dividends and distributions, which exceed earnings and profits for the full year for tax purposes, are reported as a tax return of capital.
In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Funds tax positions taken or expected to be taken on foreign, federal and state income tax returns for all open tax years and has concluded that no provision for income tax is required in the Funds financial statements.
The Funds recognize interest and penalties, if any, related to uncertain tax positions as income tax expense on the Statements of Operations. For the period ended February 28, 2019, the Funds did not incur any interest or penalties.
At August 31, 2018, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by regulations, to offset future capital gains for an unlimited period. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders.
Short-Term | Long-Term | Total Amount | ||||||||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 48,787 | $ | 72,229 | $ | 121,016 | ||||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
25,743 | | 25,743 | |||||||||
Xtrackers USD High Yield Corporate Bond ETF |
1,726 | | 1,726 |
Capital losses incurred after October 31 (post-October capital losses) and late year ordinary losses incurred after December 31 within the taxable year are deemed to arise on the first business day of each Funds next taxable year. During the period ended August 31, 2018, the following Funds incurred and will elect to defer post- October capital losses as follows:
Post-October Losses on Capital |
||||
Xtrackers High Beta High Yield Bond ETF |
$ | 213,295 | ||
Xtrackers Low Beta High Yield Bond ETF |
1,075,625 | |||
Xtrackers Short Duration High Yield Bond ETF |
49,118 | |||
Xtrackers USD High Yield Corporate Bond ETF |
1,471,007 |
As of August 31, 2018, the aggregate cost of investments for federal income tax purposes, the net unrealized appreciation (depreciation) and the aggregated gross unrealized appreciation (depreciation) on investments were as follows:
Aggregate Tax Cost |
Net Unrealized Appreciation (Depreciation) |
Aggregate Gross Unrealized Appreciation |
Aggregate Gross Unrealized (Depreciation) |
|||||||||||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 4,851,536 | $ | 57,815 | $ | 130,313 | $ | (72,498 | ) | |||||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
4,876,867 | (74,547 | ) | 90,504 | (165,051 | ) | ||||||||||
Xtrackers High Beta High Yield Bond ETF |
154,286,436 | (2,637,654 | ) | 1,556,723 | (4,194,377 | ) | ||||||||||
Xtrackers Low Beta High Yield Bond ETF |
138,480,825 | (1,480,454 | ) | 240,562 | (1,721,016 | ) | ||||||||||
Xtrackers Short Duration High Yield Bond ETF |
41,298,427 | (238,042 | ) | 272,032 | (510,074 | ) | ||||||||||
Xtrackers USD High Yield Corporate Bond ETF |
1,879,438,061 | (13,160,386 | ) | 10,074,831 | (23,235,217 | ) |
The tax character of current year distributions will be determined at the end of the current fiscal year.
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Foreign Taxes The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, capital gains on investments, certain foreign currency transactions or other corporate events. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which the Funds invest. These foreign taxes, if any, are paid by the Funds and are reflected in their Statements of Operations as follows: foreign taxes withheld at source are presented as a reduction of income, and foreign taxes on capital gains from sales of investments and foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable as of February 28, 2019, if any, are disclosed in the Funds Statements of Assets and Liabilities.
Foreign Currency Translations The books and records of the Funds are maintained in U.S. dollars. Investment securities and other assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the prevailing exchange rates at period end. Purchases and sales of investment securities, income and expenses are translated into U.S. dollars at the prevailing exchange rates on the respective dates of the transactions.
Net realized and unrealized gains and losses on foreign currency transactions represent net gains and losses between trade and settlement dates on securities transactions, the acquisition and disposition of foreign currencies, and the difference between the amount of net investment income accrued and the U.S. dollar amount actually received. The portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed, but is included with net realized and unrealized gain/appreciation and loss/depreciation on investments.
Securities Lending The Funds may lend securities to certain financial institutions under the terms of their securities lending agreement. During the term of the loans the Funds continue to receive interest and dividends generated by the securities and to participate in any changes in their market value. The Funds require the borrowers of the securities to maintain collateral with the Funds consisting of cash and/or securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities having a value at least equal to the value of the securities loaned. When the collateral falls below specified amounts, the lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the securities lending agreement. During the period ended February 28, 2019, the Funds invested the cash collateral into a joint trading account in DWS Government & Agency Securities Portfolio, an affiliated money market fund managed by DWS Investment Management Americas, Inc. DWS Investment Management Americas, Inc. receives a management/administration fee (0.11% annualized effective rate as of February 28, 2019) on the cash collateral invested in DWS Government & Agency Securities Portfolio. The Funds receive compensation for lending their securities either in the form of fees or by earning interest on invested cash collateral net of borrower rebates and fees paid to a lending agent. Either the Fund or the borrower may terminate the loan at any time and the borrower, after notice, is required to return borrowed securities within a standard time period. There may be risks of delay and costs in recovery of securities or even loss of rights in the collateral should the borrower of the securities fail financially. If the Funds are not able to recover securities lent, the Funds may sell the collateral and purchase a replacement investment in the market, incurring the risk that the value of the replacement security is greater than the value of the collateral. The Funds are also subject to all investment risks associated with the reinvestment of any cash collateral received, including, but not limited to, interest rate, credit and liquidity risk associated with such investments.
As of February 28, 2019, the Funds listed below had securities on loan, which were classified as bonds in the Schedule of Investments. The value of the related collateral exceeded the value of the securities loaned at year end.
Remaining Contractual Maturity of the Agreements, as of February 28, 2019 |
||||||||||||||||||||
Securities Lending Transactions | Overnight and Continuous |
<30 Days | Between 30 & 90 days |
>90 days | Total | |||||||||||||||
Xtrackers High Beta High Yield Bond ETF |
| |||||||||||||||||||
Corporate Bonds |
$ | 14,261,434 | $ | 10,292 | $ | 7,318 | $ | 816,131 | $ | 15,095,175 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 15,095,175 | |||||||||||||||||
Xtrackers Low Beta High Yield Bond ETF |
| |||||||||||||||||||
Corporate Bonds |
$ | 2,001,021 | $ | 20,085 | $ | 13,904 | $ | 772,312 | $ | 2,807,322 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 2,807,322 |
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Remaining Contractual Maturity of the Agreements, as of February 28, 2019 |
||||||||||||||||||||
Securities Lending Transactions | Overnight and Continuous |
<30 Days | Between 30 & 90 days |
>90 days | Total | |||||||||||||||
Xtrackers Short Duration High Yield Bond ETF |
| |||||||||||||||||||
Corporate Bonds |
$ | 3,229,873 | $ | 10,507 | $ | 7,280 | $ | 417,697 | $ | 3,665,357 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 3,665,357 | |||||||||||||||||
Xtrackers USD High Yield Corporate Bond ETF |
| |||||||||||||||||||
Corporate Bonds |
$ | 159,828,582 | $ | 298,254 | $ | 279,294 | $ | 13,820,040 | $ | 174,226,170 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 174,226,170 |
During the period ended February 28, 2019, Xtrackers Barclays International Corporate Bond Hedged ETF and Xtrackers Barclays International Treasury Bond Hedged ETF had no securities on loan.
Derivatives
Forward Foreign Currency Contracts Xtrackers Barclays International Corporate Bond Hedged ETF and Xtrackers Barclays International Treasury Bond Hedged ETF enter into forward foreign currency contracts (forward currency contracts) designed to offset the Funds exposure to non-U.S. currencies. In addition, the Funds may enter into forward currency contracts to facilitate local securities settlements or to protect against currency exposure in connection with distributions to Shareholders.
A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. For the period ended February 28, 2019, the Funds invested in forward currency contracts to hedge against changes in the value of the U.S. dollar against specified non-U.S. currencies.
The gain or loss arising from the difference between the original contract and the closing of such contract would be included in net realized gain or loss on forward currency contracts. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. The face or contract amount, in U.S. dollars reflects the total exposure the Fund has in that particular currency contract.
A summary of the open forward currency contracts as of February 28, 2019 is included in a table following the Funds Schedule of Investments. The investment in forward currency contracts short vs. U.S. dollars had a contract value generally indicative of a range of the total exposure the respective Fund had to the value of non U.S. currencies during the period ended February 28, 2019.
The following tables summarize the value of the Funds derivative instruments held as of February 28, 2019 and the related location in the accompanying Statement of Assets and Liabilities, presented by primary underlying risk exposure:
Asset Derivatives |
Liability Derivatives |
|||||||||||||
Xtrackers Barclays International Corporate Bond Hedged ETF | ||||||||||||||
Foreign exchange contracts | Unrealized appreciation on forward foreign currency contracts | $ | 50,032 | Unrealized depreciation on forward foreign currency contracts | $ | 10,242 | ||||||||
Xtrackers Barclays International Treasury Bond Hedged ETF | ||||||||||||||
Foreign exchange contracts | Unrealized appreciation on forward foreign currency contracts | $ | 82,758 | Unrealized depreciation on forward foreign currency contracts | $ | 28,558 |
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Additionally, the amount of realized and unrealized gains and losses on derivative instruments recognized in the Funds earnings during the period ended February 28, 2019 and the related location in the accompanying Statement of Operations is summarized in the following tables by primary underlying risk exposure:
Net Realized Gain (Loss) from: |
||||
Forward Foreign Currency Contracts Foreign Exchange Contracts |
||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 126,548 | ||
Xtrackers Barclays International Treasury Bond Hedged ETF |
55,842 | |||
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
Forward Foreign Currency Contracts Foreign Exchange Contracts |
||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | (5,839 | ) | |
Xtrackers Barclays International Treasury Bond Hedged ETF |
20,282 |
For the period ended February 28, 2019 the average monthly volume of derivatives was as follows:
Forward Foreign Currency Contracts (Contract Value) |
||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | (4,946,275 | ) | |
Xtrackers Barclays International Treasury Bond Hedged ETF |
(5,363,329 | ) |
As of February 28, 2019, the Funds have transactions subject to enforceable master netting agreements which govern the terms of certain transactions, and reduce the counterparty risk associated with such transactions. Master netting agreements allow a Fund to close out and net total exposure to a counterparty in the event of a deterioration in the credit quality or contractual default with respect to all of the transactions with a counterparty. As defined by the master netting agreement, the Funds may have collateral agreements with certain counterparties to mitigate risk. Interest expense from collateral received, if any, is included in Other expenses on the Statements of Operations. For financial reporting purposes the Statement of Assets and Liabilities generally shows derivatives assets and liabilities on a gross basis, which reflects the full risks and exposures prior to netting. A reconciliation of the gross amounts on the Statement of Assets and Liabilities to the net amounts by counterparty, including any collateral exposure, is included in the following tables:
Gross Amounts of Assets Presented in the Statement of Assets and Liabilities |
Financial Instruments and Derivatives Available for Offset |
Collateral Received |
Net Amount of Derivatives Assets |
Gross Amounts of Liabilities Presented in the Statement of Assets and Liabilities |
Financial Instruments and Derivatives Available for Offset |
Collateral Pledged |
Net Amount of Derivatives Liabilities |
|||||||||||||||||||||||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
| |||||||||||||||||||||||||||||||
The Bank of Nova Scotia |
$ | 50,032 | $ | (10,242 | ) | $ | | $ | 39,790 | $ | 10,242 | $ | (10,242 | ) | $ | | $ | | ||||||||||||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
| |||||||||||||||||||||||||||||||
The Bank of Nova Scotia |
$ | 82,758 | $ | (28,558 | ) | $ | | $ | 54,200 | $ | 28,558 | $ | (28,558 | ) | $ | | $ | |
Affiliated Cash Management Vehicles The Funds may invest uninvested cash balances in DWS Government Money Market Series and DWS ESG Liquidity Fund, affiliated money market funds which are managed by DWS Investment Management Americas, Inc. (DIMA), also an indirect, wholly owned subsidiary of DWS Group GmbH & Co. KGaA. Each affiliated money market fund is managed in accordance with Rule 2a-7 under the 1940 Act, which governs the quality, maturity, diversity and liquidity of instruments in which a money market fund may invest. DWS Government Money Market Series seeks to maintain a stable net asset value, and DWS ESG Liquidity Fund maintains a floating net asset value. The Funds indirectly bear their proportionate share of the expenses of each affiliated money market fund in which they invest. The Advisor will waive an amount of the unitary management fee payable to the Advisor by the Funds equal to such acquired funds fees and expenses on the Funds assets invested in the affiliated money market funds.
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
3. Investment Advisory and Other Agreements
The Advisor has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees. Under an investment advisory agreement between the Trust, on behalf of the Funds, and the Advisor (the Investment Advisory Agreement), the Advisor is responsible for arranging sub-advisory, transfer agency, custody, fund administration, and all other non-distribution related services for the Funds to operate.
For its investment advisory services to the Funds below, the Advisor is entitled to receive a unitary management fee from each Fund based on each Funds average daily net assets, computed and accrued daily and payable monthly, at an annual rate equal to:
Unitary Management Fee |
||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
0.30 | % | ||
Xtrackers Barclays International Treasury Bond Hedged ETF |
0.25 | % | ||
Xtrackers High Beta High Yield Bond ETF |
0.35 | % | ||
Xtrackers Low Beta High Yield Bond ETF |
0.25 | % | ||
Xtrackers Short Duration High Yield Bond ETF |
0.20 | % | ||
Xtrackers USD High Yield Corporate Bond ETF |
0.20 | % |
The Advisor for the Funds below has contractually agreed to waive a portion of its management fees in an amount equal to the acquired funds fees and expenses attributable to the Funds investments in affiliated cash management vehicles. For the period ended February 28, 2019, the Advisor waived expenses of the Funds as follows:
Expenses Waived |
||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 6 | ||
Xtrackers Barclays International Treasury Bond Hedged ETF |
10 | |||
Xtrackers High Beta High Yield Bond ETF |
275 | |||
Xtrackers Low Beta High Yield Bond ETF |
593 | |||
Xtrackers Short Duration High Yield Bond ETF |
103 | |||
Xtrackers USD High Yield Corporate Bond ETF |
3,417 |
Effective March 29, 2019, the Advisor for Xtrackers USD High Yield Corporate Bond ETF has contractually agreed, until March 30, 2020, to waive a portion of its management fees to the extent necessary to prevent the operating expenses of the Fund from exceeding 0.15% of the Funds average daily net assets.
Out of the unitary management fee, the Advisor pays substantially all expenses of each Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services, and expenses of the Independent Trustees. Each Fund is responsible for the payment of interest expense, taxes, brokerage expenses, distribution fees or expenses, if any, litigation expenses and extraordinary expenses.
The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as Administrator, Custodian, Accounting Agent, Lending Agent and Transfer Agent for each Fund.
ALPS Distributors, Inc. (the Distributor) serves as the distributor of Creation Units for each Fund on an agency basis. The Distributor does not maintain a secondary market in shares of the Funds.
The Board of Trustees is currently comprised of four Trustees, including three Independent Trustees. The Advisor paid retainer fees and attendance fees to each Independent Trustee; retainer fees to the Chairman of the Board of Trustees and the Chairman of the Audit Committee; and attendance fees to each member of the Audit Committee (which is comprised of all of the Funds Independent Trustees).
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
4. Investment Portfolio Transactions
For the period ended February 28, 2019, the cost of investments purchased and proceeds from sale of investments (excluding in-kind transactions and short-term investments) were as follows:
Purchases | Sales | |||||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 941,694 | $ | 839,402 | ||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
5,634,746 | 651,703 | ||||||
Xtrackers High Beta High Yield Bond ETF |
31,332,419 | 31,367,248 | ||||||
Xtrackers Low Beta High Yield Bond ETF |
38,955,621 | 37,077,014 | ||||||
Xtrackers Short Duration High Yield Bond ETF |
9,303,171 | 9,673,144 | ||||||
Xtrackers USD High Yield Corporate Bond ETF |
243,912,146 | 247,930,910 |
For the period ended February 28, 2019, the cost of in-kind purchases and proceeds from in-kind sales were as follows:
Purchases | Sales | |||||||
Xtrackers High Beta High Yield Bond ETF |
$ | 2,214,785 | $ | | ||||
Xtrackers Low Beta High Yield Bond ETF |
4,698,443 | | ||||||
Xtrackers Short Duration High Yield Bond ETF |
9,787,869 | 4,624,840 | ||||||
Xtrackers USD High Yield Corporate Bond ETF |
1,828,209,113 | 981,776,870 |
Transactions with Affiliates. The Funds may purchase securities from, or sell securities to, an affiliated fund provided the affiliation is solely due to having a common investment advisor, common officers, or common trustees. During the period ended February 28, 2019, the Funds engaged in securities purchases and securities sales with an affiliated fund in compliance with Rule 17a-7 under the 1940 Act as follows:
Securities Purchased | Securities Sold | Net Realized Gain (Loss) on Securities Sold |
||||||||||
Xtrackers High Beta High Yield Bond ETF |
$ | 11,194,994 | $ | 17,168,985 | $ | (144,827 | ) | |||||
Xtrackers Low Beta High Yield Bond ETF |
17,168,985 | 11,194,994 | (503,246 | ) |
5. Fund Share Transactions
As of February 28, 2019, there were unlimited Fund shares, no par value, authorized by the Trust. Fund shares are issued and redeemed by each Fund only in Creation Units or multiples thereof. Except when aggregated in Creation Units, shares of each Fund are not redeemable. Transactions in capital shares for each Fund are disclosed in detail in the Statements of Changes in Net Assets. The consideration for the purchase of Creation Units of a Fund generally consists of the in-kind contribution of a designated portfolio of securities constituting a portfolio sampling representation of the securities included in the respective Funds Underlying Index and an amount of cash, which under certain circumstances may include cash in lieu of portfolio securities. Investors purchasing and redeeming Creation Units pay a purchase transaction fee and a redemption transaction fee to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units.
6. Concentration of Ownership
From time to time, the Funds may have a concentration of several shareholder accounts holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Fund. At February 28, 2019, there was one affiliated shareholder account for the fund listed below holding a significant percentage of the shares outstanding:
Approximate Percent of Outstanding Shares Held |
||||
Xtrackers Barclays International Treasury Bond Hedged ETF |
18 | % |
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DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
7. Investing in High-Yield Debt Securities
High-yield debt securities or junk bonds are generally regarded as speculative with respect to the issuers continuing ability to meet principal and interest payments. A funds performance could be hurt if an issuer of a debt security suffers an adverse change in financial condition that results in the issuer not making timely payments of interest or principal, a security downgrade or an inability to meet a financial obligation. High-yield debt securities total return and yield may generally be expected to fluctuate more than the total return and yield of investment-grade debt securities. A real or perceived economic downturn or an increase in market interest rates could cause a decline in the value of high-yield debt securities, result in increased redemptions and/or result in increased portfolio turnover, which could result in a decline in net asset value of a fund, reduce liquidity for certain investments and/or increase costs. High-yield debt securities are often thinly traded and can be more difficult to sell and value accurately than investment-grade debt securities as there may be no established secondary market. Investments in high-yield debt securities could increase liquidity risk for a fund. In addition, the market for high-yield debt securities can experience sudden and sharp volatility which is generally associated more with investments in stocks.
8. Line of Credit
The Trust has entered into a senior unsecured credit facility with a syndication of banks which allows the Xtrackers Barclays International Corporate Bond Hedged ETF, Xtrackers Barclays International Treasury Bond Hedged ETF, Xtrackers USD High Yield Corporate Bond ETF and certain other funds managed by the Advisor to borrow up to $105 million. Each Fund may borrow money under this credit facility to the extent necessary for temporary or emergency purposes, including the funding of shareholder redemption requests, trade settlements, and as necessary to distribute to shareholders any income necessary to maintain each Funds status as a regulated investment company. Borrowings are charged an interest rate of 1.25% per annum plus the greater of the Federal Funds Effective Rate or the one-month LIBOR Rate. Each Fund may borrow up to the lesser of a pro-rata share of the credit facility at the amount listed below or 33 percent of its net assets as permitted by the Act. The Funds had no outstanding loans at February 28, 2019.
Pro-rata Share | ||||
Xtrackers Barclays International Corporate Bond Hedged ETF |
$ | 1,050,000 | ||
Xtrackers Barclays International Treasury Bond Hedged ETF |
1,050,000 | |||
Xtrackers USD High Yield Corporate Bond ETF |
5,250,000 |
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DBX ETF Trust
Xtrackers Barclays International Corporate Bond Hedged ETF, Xtrackers Barclays International Treasury Bond Hedged ETF, Xtrackers High Beta High Yield Bond ETF, Xtrackers Low Beta High Yield Bond ETF, Xtrackers Short Duration High Yield Bond ETF and Xtrackers USD High Yield Corporate Bond ETF
After discussions at the meeting of the Board of Trustees (Board or Trustees) held on February 11-12, 2019 (the Meeting), the Trustees, including the Independent Trustees (those not affiliated with DBX ETF Trust (the Trust) or its service providers), unanimously approved the continuance of the Investment Advisory Agreement with respect to Xtrackers Barclays International Corporate Bond Hedged ETF, Xtrackers Barclays International Treasury Bond Hedged ETF, Xtrackers High Beta High Yield Bond ETF, Xtrackers Low Beta High Yield Bond ETF, Xtrackers Short Duration High Yield Bond ETF and Xtrackers USD High Yield Corporate Bond ETF (each a Fund, and collectively, the Funds). The Independent Trustees were advised throughout the review and Meeting by K&L Gates LLP (Independent Trustee Counsel).
Before reaching their decision to approve the Investment Advisory Agreement for another annual period, the Independent Trustees evaluated the materials furnished to them in advance of the Meeting from DBX Advisors LLC (DBX or the Advisor) for purposes of reviewing the agreements terms and also took into consideration the discussions they had with management during the Meeting and among themselves during their Executive Sessions held on February 11 and February 12, 2019. The Independent Trustees also noted that they had received and should take into consideration a substantial amount of information furnished throughout the year at regular Board meetings, which information included, among other things, an analysis of each Funds investment performance and related financial information, presentations given by DBX, as well as its periodic reports on brokerage commissions, portfolio execution and other services provided to the Funds.
In reaching its decision to continue in effect the Investment Advisory Agreement for another annual period, the Board considered all factors it believed relevant, including (1) the nature, extent and quality of the services provided to the Funds and their shareholders; (2) the financial resources of DBX and its resulting ability to perform its obligations under the Investment Advisory Agreement; (3) the competitiveness of the advisory fee; (4) the total cost of the services provided by and the profits realized by the Advisor from its relationship with the Funds; (5) the extent to which economies of scale have been realized, and if the Funds shareholders have benefitted from those economies; and (6) fall out benefits, if any, enjoyed by the Advisor.
The Board reached a determination, with the assistance of Dechert LLP (Trust Counsel) and through the exercise of its business judgment, that approval of the Investment Advisory Agreement and the compensation to be received thereunder is in the best interests of each Fund and its shareholders as well as consistent with the Boards duties under state and federal law. The Board reached this conclusion based on multiple factors.
Nature, Extent and Quality of Services. The Board reviewed in detail the nature, extent and quality of services provided by the Advisor under the Investment Advisory Agreement. In doing so, the Board considered the information it had received from and the discussions it had with the Advisor continuously during the prior year, in addition to the information the Advisor had provided in response to the Boards requests prior to the Meeting. The Board considered that these services include, among other things, furnishing a continuous investment program for the Funds, including arranging for, or implementing, the purchase and sale of portfolio securities, the provision of general corporate services such as portfolio management compliance services and the preparation and filing of certain reports on behalf of the Trust. The Board also considered, among other things, the professional experience, qualifications and performance of the senior management and key professional personnel of the Advisor, including portfolio management.
The Board considered that the Advisor provides, at its own expense, office facilities and equipment for use by the Funds and supervisory persons responsible for supervising and monitoring the Trusts service providers. The Board also considered that the Advisor pays or arranges for the compensation of officers of the Trust who are also officers or employees of the Advisor or one of its Deutsche Bank affiliates, except as may otherwise be determined by the Board. In addition, the Board considered that the Advisor arranges for the provision of transfer agency, custody, fund administration and accounting, and other non-distribution services necessary for the Funds operations. The Board also considered that in addition to managing the Funds portfolios directly, the Advisor provides oversight of day-to-day operations, including monitoring tracking error, providing services in
88
DBX ETF Trust
Board Considerations in Approval of Investment Advisory Contracts (Unaudited) (Continued)
connection with the creation and redemption of creation units and assistance in meeting legal, compliance and regulatory requirements applicable to the Funds. The Trustees took into consideration that tracking error for each Fund during the year was in an expected range.
Based on its review, the Board concluded that the nature, extent, and quality of services provided by the Advisor under the Investment Advisory Agreement are reasonable and appropriate in relation to the fees paid to the Advisor, taking special consideration of the fact that the advisory fee is a unitary fee and, as a result, a portion of the unitary advisory fee will be used to compensate the Funds service providers. The Board considered the staffing of the Advisor, including the training, qualifications and experience of investment personnel in managing the Funds. The Board also considered the expertise of the Advisor in supervising third party service providers to the Funds, such as the administrator and the custodian, noting the Advisors extensive work with these service providers (including onsite due diligence sessions) to conduct such supervision. The Board further considered the compliance program of the Advisor, which supports the Funds compliance program.
Advisors Financial Resources. In connection with the assessment of the ability of the Advisor to perform its duties under the Investment Advisory Agreement, the Board considered the Advisors financial condition and whether it has the resources necessary to carry out its functions. The Board concluded that the Advisor has the financial resources necessary to perform its obligations under the Investment Advisory Agreement.
Reasonableness of Advisory Fee. The Board compared each Funds advisory fee to that of other pertinent exchange-traded funds (ETFs) and noted that each Funds fee is competitive with the fees of its respective peer group. The Board agreed that it was familiar with the Advisors methodology for selecting each Funds peer group and believed that the Funds peer groups were appropriate. The Board considered that the fee for each of the Funds is a unitary fee pursuant to which the Advisor pays all of the Funds costs (subject to certain specified exceptions). The Board also considered that each Funds portfolio is managed on a day-to-day basis by the Advisor and that the Advisor also provides oversight of day-to-day operations, including monitoring tracking error, providing services in connection with creation and redemption units and assistance in meeting legal and regulatory requirements applicable to the Funds. Based on its review, the Board concluded that the advisory fee for each Fund is reasonable in light of the services provided.
Costs of Services and Profitability. The Board considered the expenses of the Advisor in developing and rendering services provided to the Funds and the information provided by the Advisor to the Board regarding the Funds profitability. The Board considered that the Advisor had provided extensive information about the Advisors profitability and the Advisors methodology in determining profitability. While the Advisor had provided information about the Advisors expenses relating to marketing the Funds, the Board considered the Advisors profitability without accounting for such expenses. The Board determined that, although only some of the Funds were profitable as of this time, the Advisors profitability with respect to each profitable Fund was not excessive. The Board considered whether the Advisor would benefit in other ways from its relationships with the Funds and concluded that there were no material fall-out benefits likely to accrue to the Advisor related to the operation of the Funds.
Economies of Scale. The Board considered that certain Funds had attracted a substantial amount of assets, but determined that those Funds were not experiencing economies of scale beyond what was reflected in each Funds unitary fee, which the Board noted was very competitive. The Board considered that the other Funds were not experiencing economies of scale at this time and determined to revisit this matter after the Funds had attracted more assets.
Given all the information available to it and considering all material factors, the Board concluded that the Investment Advisory Agreement was fair and reasonable and it was unanimously approved.
89
DBX ETF Trust
Proxy Voting Policies and Procedures
The Funds policies and procedures for voting proxies for portfolio securities and information about how each Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 are available on our Web site www.Xtrackers.com (click on Resources and Proxy Voting at the top of the page) or on the SECs Web site www.sec.gov. To obtain a written copy of the Funds policies and procedures without charge, upon request, call us toll free at 855-329-3837.
Quarterly Portfolio Disclosure
The Funds are required to file their complete schedule of portfolio holdings with the SEC for their first and third fiscal quarters on Form N-Q or Form N-PORT (available for filings after March 31, 2019). Copies of the filings are available without charge, upon request on the SECs website at www.sec.gov and are available by calling the Trust at 855-329-3837.
Information about each Funds portfolio holdings is available daily at www.Xtrackers.com.
Discount/Premium Information
Information regarding how often shares of each Fund traded on NYSE Arca or Cboe, as applicable, at a price above (i.e., at a premium) or below (i.e., at a discount) the NAV of the Fund can be found at www.Xtrackers.com.
90
DBX ETF Trust
DBX Advisors LLC (Advisors) collects non-public information about you from the following sources: (i) information received from you on applications or other forms; and (ii) information about your transactions with the Advisors, Advisors affiliates and third-party service providers and vendors. Advisors does not disclose any non-public personal information about you to anyone, other than as set forth below, as permitted by applicable law and regulation. Advisors may disclose non-public personal information about you to the funds in which you invest, to Advisors affiliates, and to non-affiliated companies that work with Advisors to service your account(s), or to provide services or process transactions that you have requested. Advisors may disclose non-public personal information in situations that may include, but are not limited to, in response to legal and/or regulatory inquiries and the proposed or actual sale, assignment merger or other transfer of all or a portion of Advisors business to another business entity. Advisors may also disclose non-public personal information about you to parties representing you, such as your investment representative, your accountant, your tax advisor, or to other third parties at your direction/consent. Advisors will not sell, rent, license or trade your personal and financial information to or with third parties for their own direct marketing use unless you give us general or specific consent to do so. If you decide to close your account(s) or become an inactive customer, Advisors will adhere to the privacy policies and practices as described in this notice. Advisors restricts access to your personal and account information to those employees who need to know that information to provide products and services to you. Advisors maintains reasonable and customary physical, electronic and procedural safeguards to guard your non-public personal information.
Advisors reserves the right, at their discretion, to change, modify, add, or remove portions of this Privacy Policy Notice, and any of the policies described herein, at any time. Advisors will indicate any such changes to the Privacy Policy Notice at the privacy link which can be found at www.Xtrackers.com. At all times, you are bound by the then-current version of the Privacy Policy and all applicable laws. Advisors highly recommends that you review this Privacy Policy Notice from time to time to ensure that you are familiar with the most recent version. The examples contained in this Privacy Policy Notice are illustrations; they are not intended to be exclusive.
91
DBX ETF Trust
This report is intended for the shareholders of the DBX ETF Trust.
This report must be preceded or accompanied by a prospectus.
Investing involves risk, including the possible loss of principal. Bond investments are subject to interest rate, credit, liquidity and market risks to varying degrees. When interest rates rise, bond prices generally fall. Foreign investing involves greater and different risks than investing in U.S. companies, including currency fluctuations, less liquidity, less developed or less efficient trading markets, lack of comprehensive company information, political instability and differing auditing and legal standards. Emerging markets tend to be more volatile and less liquid than the markets of more mature economies, and generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. Funds investing in a single industry, or group of industries, country or in a limited geographic region generally are more volatile than more diversified funds. Investments in lower-quality (junk bonds) and non-rated securities present greater risk of loss than investments in higher-quality securities. Distressed securities are speculative and involve substantial risks beyond the risks of investing in junk bonds, such as no interest payments or repayment of principal, or the loss of the entire investment in the distressed security. These funds are non-diversified and can take larger positions in fewer issues, increasing their potential risk. Credit risk refers to the ability of an issuer to make timely payments of principal and interest. Investing in derivatives entails special risks relating to liquidity, leverage and credit that may reduce returns and/or increase volatility. A Funds use of forward currency contracts may not be successful in hedging currency exchange rates changes and could eliminate some or all of the benefit of an increase in the value of a foreign currency versus the U.S. dollar. Performance of the Funds may diverge from that of the Underlying Index due to operating expenses, transaction costs, cash flows, use of sampling strategies or operational inefficiencies. An investment in these Funds should be considered only as a supplement to a complete investment program for those investors willing to accept the risks associated with the Funds. Please read the prospectus for more information.
Shares of the Funds are bought and sold at market price (not NAV) throughout the day on the NYSE Arca, Inc. or Cboe BZX Exchange, Inc., as applicable. Transactions in Fund shares may result in brokerage commissions and may generate tax consequences. There can be no assurance that an active trading market for shares of a Fund will develop or be maintained.
DBX ETF Trust Funds are distributed by ALPS Distributors, Inc. (ALPS) The Funds are managed by DBX Advisors LLC which is not affiliated with ALPS.
The brand DWS represents DWS Group GmbH & Co. KGaA and any of its subsidiaries such as DWS Distributors, Inc. which offers investment products or DWS Investment Management Americas Inc. and RREEF America L.L.C. which offer advisory services.
HYUP, HYDW, SHYL, and HYLB are not sponsored, promoted, sold or supported in any other manner by Solactive AG (the Licensor) nor does the trademark or the Index Price at any time or in any other respect.
Barclays Bank PLC and its affiliates (Barclays) are not the issuer or producer of Xtrackers Barclays International Treasury Bond Hedged ETF or Xtrackers Barclays International Corporate Bond Hedged ETF (the Funds) and Barclays has no responsibilities, obligations or duties to investors in the Funds.
Copyright © 2019 DWS Group. All rights reserved. XtrackersTM is a trademark of DWS Investment GmbH. All other trademarks, servicemarks or registered trademarks are the property of their respective owners.
Not FDIC Insured | No Bank Guarantee | May Lose Value
DBX ETF Trust
Investment advisor DBX Advisors LLC 345 Park Avenue New York, NY 10154 |
Administrator, custodian, fund accounting agent, lending agent & transfer agent The Bank of New York Mellon 240 Greenwich Street New York, NY 10286 |
Distributor ALPS Distributors, Inc. 1290 Broadway Suite 1100 Denver, CO 80203 | ||
Independent registered public accounting firm Ernst & Young LLP 5 Times Square New York, NY 10036 |
Legal counsel Dechert LLP 1095 Avenue of the Americas New York, NY 10036 |
R-050032-3 (4/19) DBX003834 (4/20)
February 28, 2019
Semi-Annual Report
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (ACSG)
Xtrackers MSCI EAFE ESG Leaders Equity ETF (EASG)
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (EMSG)
DBX ETF Trust
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Board Considerations in Approval of Investment Advisory Contracts |
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45 |
To our Shareholders: (Unaudited)
Dear Shareholder,
We are pleased to provide this semi-annual report for our three comprehensive ESG equity ETFs for the period ended February 28, 2019.
While ESG investing has recently become a large and fast-growing market segment, environmental, social and governance factors have been part of DWSs core DNA for more than 20 years. More than one-quarter of assets under management globally are now being invested according to the premise that ESG factors can materially affect a companys performance and market value1. Our goal is to provide investors with solutions that allow them to invest along with their values while also ensuring cost-efficient access to markets.
The global economy witnessed moderate growth in the reporting period, driven by relatively strong growth in the U.S. compared with sluggish growth in Eurozone, China, and Japan. Tighter monetary policy, geopolitical uncertainty across regions, and maturing global cycles contributed to more turbulent markets. Interest rates were, by and large, accommodative from major central banks, namely the European Central Bank, the Bank of China, the Bank of Japan, and even the Federal Reserve, which carried out interest rate hikes at a slower pace. Meanwhile, emerging markets face headwinds from a strong U.S. dollar and contractionary U.S. monetary policy.
Sustainable investing strategies have helped listed companies improve their performance on material ESG issues and should continue to do so. In a major development, the 24th Conference of Parties (COP) to the United Nations Framework Convention on Climate Changes was held at Katowice, Poland, in December. Major pledges were announced during the conference to cement the Paris agreement, which includes the World Banks doubling its fund for low-carbon projects to $200 billion between 2021 and 2025. The European Bank for Reconstruction and Development (EBRD) also updated its strategy, ceasing to finance thermal coal mining and any upstream oil exploration. Subsequently, as part of the Institutional Investors Group on Climate Change, California Public Employees Retirement System and other asset owners have urged G7 governments to develop strict national plans to cut greenhouse gas emissions by 2020.
In the Eurozone, aggregate growth slowed toward the end of 2018, due to auto downturns, a weak industrial sector, and staggered consumer confidence. The U.K. faced subdued growth owing to low business confidence and Brexit uncertainty. Germany avoided a technical recession in the fourth quarter, resulting in flat growth. Government consumption and solid fixed investment growth helped balance the slowdown in the automobile sector due to the introduction of new emissions-testing standards and weak external demand. France witnessed moderate growth, backed by strong growth in exports despite the Gilets Jaunes protests.
Growth in most Asian countries was upbeat in spite of the downward pressure on regional growth due to the trade spat between the U.S. and China. This expansion was backed by bold government spending, declining unemployment rates, increased private consumption, and an improvement in the external sector. The Chinese economy continues to grow at a decelerated pace, due to efforts to tackle financial deleveraging and relatively relaxed monetary policies. The global economy is expected to grow, albeit at a slower pace, in 2019 as the market frets about ongoing trade tensions and monetary tightening. Our team appreciates your trust and looks forward to continue serving your investment needs through innovative index-driven strategies.
Sincerely,
/s/ Freddi Klassen
Freddi Klassen
President and Chief Executive Officer
1 McKinsey as of 2017
Assumptions, estimates and opinions contained in this document constitute our judgment as of the date of the document and are subject to change without notice. Any projections are based on a number of assumptions as to market conditions and there can be no guarantee that any projected results will be achieved. Past performance is not a guarantee of future results.
1
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (ACSG)
The Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the MSCI ACWI ex USA ESG Leaders Index (the Underlying Index). The Underlying Index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers and is constructed using regional indexes that provide exposure to large- and medium-capitalization companies from developed and emerging markets countries (excluding the United States). It is not possible to invest directly into an index.
Sector Diversification* as of 2/28/19 |
Financials |
22.1% | |||
Consumer Discretionary |
12.7% | |||
Industrials |
11.3% | |||
Information Technology |
9.3% | |||
Consumer Staples |
8.7% | |||
Health Care |
8.5% | |||
Materials |
7.6% | |||
Communication Services |
7.6% | |||
Energy |
5.6% | |||
Utilities |
3.4% | |||
Real Estate |
3.2% | |||
|
|
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100.0% |
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 6.
2
DBX ETF Trust
Xtrackers MSCI EAFE ESG Leaders Equity ETF (EASG)
The Xtrackers MSCI EAFE ESG Leaders Equity ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the MSCI EAFE ESG Leaders Index (the Underlying Index). The Underlying Index s a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers and consists of large- and medium-capitalization companies across developed markets countries, excluding Canada and the United States. It is not possible to invest directly into an index.
* As a percent of total investments excluding securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 17.
3
DBX ETF Trust
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (EMSG)
The Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (the Fund), using a passive or indexing investment approach, seeks investment results that correspond generally to the performance, before fees and expenses, of the MSCI Emerging Markets ESG Leaders Index (the Underlying Index). The Underlying Index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers and consists of large- and medium-capitalization companies across emerging markets countries. It is not possible to invest directly into an index.
* As a percent of total investments excluding exchange-traded funds, securities lending collateral and cash equivalents.
Portfolio holdings and characteristics are subject to change. For more complete details about the Funds investment portfolio see page 23.
4
DBX ETF Trust
As a shareholder of one or more of the Funds, you incur two types of costs: (1) transaction costs, including brokerage commissions paid on purchases and sales of fund shares, and (2) ongoing costs, including management fees and other Fund expenses. In the most recent six-month period the Funds limited these expenses; had they not done so, expenses would have been higher. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The examples in the table are based on an investment of $1,000 invested at the beginning of the period and held for the entire period (commencement of operations, as noted below, to February 28, 2019).
Actual expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading Expenses Paid During the Period to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds actual expense ratios and an assumed rate of return of 5% per year before expenses (which is not the Funds actual return). The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value September 1, 2018 |
Ending Account Value February 28, 2019 |
Annualized Expense Ratio |
Expenses Paid During the Period Per $1,000 |
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Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
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Actual |
$ | 1,000.00 | $ | 1,036.30 | 0.16 | % | $ | 0.38 | (3) | |||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,024.00 | 0.16 | % | $ | 0.80 | (1) | |||||||
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
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Actual |
$ | 1,000.00 | $ | 977.30 | 0.14 | % | $ | 0.67 | (2) | |||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,024.10 | 0.14 | % | $ | 0.70 | (1) | |||||||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
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Actual |
$ | 1,000.00 | $ | 1,038.70 | 0.19 | % | $ | 0.45 | (3) | |||||||
Hypothetical (5% return before expenses) |
$ | 1,000.00 | $ | 1,023.85 | 0.19 | % | $ | 0.95 | (1) |
(1) Expenses (hypothetical expenses as if each Fund had been in existence from September 1, 2018) are equal to each Funds annualized expense ratio, multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent six-month period), then divided by 365.
(2) Expenses are equal to each Funds annualized expense ratio, multiplied by the average account value over the period, multiplied by 176 (the number of days in the period September 6, 2018 (commencement of operations) to February 28, 2019), then divided by 365.
(3) Expenses are equal to each Funds annualized expense ratio, multiplied by the average account value over the period, multiplied by 85 (the number of days in the period December 6, 2018 (commencement of operations) to February 28, 2019), then divided by 365.
5
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 6 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 7 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 8 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 9 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 10 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 11 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 12 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 13 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 14 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 12/6/2018 (Commencement of Operations) |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
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SECURITIES LENDING COLLATERAL 1.0% |
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DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (d)(e) |
||||||||||||||||||||||||||||||||||||||
| 79,663 | (f) | | | | 203 | | 79,663 | 79,663 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 1.9% |
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DWS Government Money Market Series Institutional Shares, 2.38% (d) |
||||||||||||||||||||||||||||||||||||||
| 1,945,647 | (1,795,329 | ) | | | 973 | | 150,318 | 150,318 | |||||||||||||||||||||||||||||
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| 2,025,310 | (1,795,329 | ) | | | 1,176 | | 229,981 | 229,981 | |||||||||||||||||||||||||||||
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* | Non-income producing security. |
(a) | Stapled Security A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately. |
(b) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $254,291, which is 3.3% of net assets. |
(c) | Investment was valued using significant unobservable inputs. |
(d) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(e) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $193,484. |
(f) | Represents the net increase (purchase cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
ADR: | American Depositary Receipt |
CPO: | Ordinary Participation Certificates |
GDR: | Global Depositary Receipt |
NVDR: | Non Voting Depositary Receipt |
PJSC: | Public Joint Stock Company |
QSC: | Qatari Shareholders Company |
REIT: | Real Estate Investment Trust |
SDR: | Swedish Depositary Receipt |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
At February 28, 2019, open futures contract purchased was as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Depreciation |
||||||||||||||||||
SGX NIFTY 50 Futures |
USD | 8 | $ | 173,942 | $ | 173,920 | 3/28/2019 | $ | (22 | ) |
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
See Notes to Financial Statements. | 15 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (g) |
$ | 7,466,568 | $ | | $ | | $ | 7,466,568 | ||||||||
Preferred Stocks (g) |
108,765 | | 7 | 108,772 | ||||||||||||
Rights |
0 | | | 0 | ||||||||||||
Short-Term Investments (g) |
229,981 | | | 229,981 | ||||||||||||
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TOTAL |
$ | 7,805,314 | $ | | $ | 7 | $ | 7,805,321 | ||||||||
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Liabilities |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Derivatives (h) |
||||||||||||||||
Futures Contract |
$ | (22 | ) | $ | | $ | | $ | (22 | ) | ||||||
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TOTAL |
$ | (22 | ) | $ | | $ | | $ | (22 | ) | ||||||
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(g) | See Schedule of Investments for additional detailed categorizations. |
(h) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
See Notes to Financial Statements. | 16 |
DBX ETF Trust
Xtrackers MSCI EAFE ESG Leaders Equity ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 17 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI EAFE ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 18 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI EAFE ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 19 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI EAFE ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 20 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI EAFE ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 21 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI EAFE ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 9/6/2018 (Commencement of Operations) |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 0.6% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio "DWS Government Cash Institutional Shares", 2.31% (c)(d) |
||||||||||||||||||||||||||||||||||||||
| 46,390 | (e) | | | | 414 | | 46,390 | 46,390 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 0.0% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series "Institutional Shares", 2.38% (c) |
||||||||||||||||||||||||||||||||||||||
| 66,776 | (66,721 | ) | | | 30 | | 55 | 55 | |||||||||||||||||||||||||||||
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| 113,166 | (66,721 | ) | | | 444 | | 46,445 | 46,445 | |||||||||||||||||||||||||||||
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* | Non-income producing security. |
(a) | Stapled Security A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately. |
(b) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $47,016, which is 0.6% of net assets. |
(c) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(d) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $9,989. |
(e) | Represents the net increase (purchases cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
REIT: | Real Estate Investment Trust |
SDR: | Swedish Depositary Receipt |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (f) |
$ | 7,220,073 | $ | | $ | | $ | 7,220,073 | ||||||||
Preferred Stocks (f) |
27,899 | | | 27,899 | ||||||||||||
Short-Term Investments (f) |
46,445 | | | 46,445 | ||||||||||||
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TOTAL |
$ | 7,294,417 | $ | | $ | | $ | 7,294,417 | ||||||||
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(f) | See Schedule of Investments for additional detailed categorizations. |
See Notes to Financial Statements. | 22 |
DBX ETF Trust
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 23 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 24 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 25 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
See Notes to Financial Statements. | 26 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
A summary of the Funds transactions with affiliated investments during the period ended February 28, 2019 is as follows:
Value ($) at 12/6/2018 (Commencement of Operations) |
Purchases Cost ($) |
Sales Proceeds ($) |
Net Realized Gain/(Loss) ($) |
Net Change in Unrealized Appreciation (Depreciation) ($) |
Income ($) | Capital Gain Distributions ($) |
Number of Shares at 2/28/2019 |
Value ($) at 2/28/2019 |
||||||||||||||||||||||||||||||
SECURITIES LENDING COLLATERAL 0.1% |
||||||||||||||||||||||||||||||||||||||
DWS Government & Agency Securities Portfolio DWS Government Cash Institutional Shares, 2.31% (c)(d) |
||||||||||||||||||||||||||||||||||||||
| 10,850 | (e) | | | | 14 | | 10,850 | 10,850 | |||||||||||||||||||||||||||||
CASH EQUIVALENTS 7.8% |
||||||||||||||||||||||||||||||||||||||
DWS Government Money Market Series Institutional Shares, 2.38% (c) |
||||||||||||||||||||||||||||||||||||||
| 1,828,004 | (1,219,248 | ) | | | 3,492 | | 608,756 | 608,756 | |||||||||||||||||||||||||||||
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| 1,838,854 | (1,219,248 | ) | | | 3,506 | | 619,606 | 619,606 | |||||||||||||||||||||||||||||
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* | Non-income producing security. |
(a) | All or a portion of these securities were on loan. In addition, Other assets and liabilities, net may include pending sales that are also on loan. The value of securities loaned at February 28, 2019 amounted to $705,839, which is 9.1% of net assets. |
(b) | Investment was valued using significant unobservable inputs. |
(c) | Affiliated fund managed by DWS Investment Management Americas, Inc. The rate shown is the annualized seven-day yield at period end. |
(d) | Represents cash collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. In addition, the Fund held non-cash U.S. Treasury securities collateral having a value of $715,375. |
(e) | Represents the net increase (purchases cost) or decrease (sales proceeds) in the amount invested in cash collateral for the period ended February 28, 2019. |
ADR: | American Depositary Receipt |
CPO: | Ordinary Participation Certificates |
GDR: | Global Depositary Receipt |
NVDR: | Non Voting Depositary Receipt |
PJSC: | Public Joint Stock Company |
QSC: | Qatari Shareholders Company |
See Notes to Financial Statements. | 27 |
DBX ETF Trust
Schedule of Investments
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (Continued)
February 28, 2019 (Unaudited)
REIT: | Real Estate Investment Trust |
144A: | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. |
At February 28, 2019, open futures contract purchased was as follows:
Contract Description |
Currency | Number of Contracts |
Notional Amount |
Contract Value |
Expiration Date |
Unrealized Depreciation |
||||||||||||||||||
SGX NIFTY 50 Futures |
USD | 29 | $ | 630,539 | $ | 630,460 | 3/28/2019 | $ | (79 | ) |
For information on the Funds policy and additional disclosures regarding open futures contracts, please refer to the Derivatives section of Note 2 in the accompanying Notes to Financial Statements.
Currency Abbreviations
USD | U.S. Dollar |
Fair Value Measurements
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
The following is a summary of the inputs used as of February 28, 2019 in valuing the Funds investments. For information on the Funds policy regarding the valuation of investments, please refer to the Security Valuation section of Note 2 in the accompanying Notes to Financial Statements.
Assets |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks (f) |
$ | 6,776,676 | $ | | $ | | $ | 6,776,676 | ||||||||
Preferred Stocks (f) |
339,463 | | 40 | 339,503 | ||||||||||||
Rights |
0 | | | 0 | ||||||||||||
Exchange-Traded Funds |
21,644 | | | 21,644 | ||||||||||||
Short-Term Investments (f) |
619,606 | | | 619,606 | ||||||||||||
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TOTAL |
$ | 7,757,389 | $ | | $ | 40 | $ | 7,757,429 | ||||||||
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Liabilities |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Derivatives (g) |
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Futures Contract |
$ | (79 | ) | $ | | $ | | $ | (79 | ) | ||||||
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TOTAL |
$ | (79 | ) | $ | | $ | | $ | (79 | ) | ||||||
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(f) | See Schedule of Investments for additional detailed categorizations. |
(g) | Derivatives include unrealized appreciation (depreciation) on open futures contracts. |
See Notes to Financial Statements. | 28 |
This Page is Intentionally Left Blank
29
DBX ETF Trust
February 28, 2019 (Unaudited)
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
||||||||||
Assets |
||||||||||||
Investment in non-affiliated securities at value |
$ | 7,575,340 | $ | 7,247,972 | $ | 7,137,823 | ||||||
Investment in DWS Government Money Market Series |
150,318 | 55 | 608,756 | |||||||||
Investment in DWS Government & Agency Securities Portfolio* |
79,663 | 46,390 | 10,850 | |||||||||
Foreign currency at value |
106,163 | 8,238 | 29,720 | |||||||||
Deposit with broker for futures contracts |
7,477 | | 27,119 | |||||||||
Receivables: | ||||||||||||
Investment securities sold |
9,311 | 4,613 | 45,849 | |||||||||
Variation margin on futures contracts |
4,945 | | 3,655 | |||||||||
Dividends |
16,506 | 13,434 | 23,294 | |||||||||
Interest |
273 | 1 | 1,117 | |||||||||
Securities lending income |
53 | 27 | | |||||||||
Foreign tax reclaim |
291 | 910 | | |||||||||
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Total Assets |
$ | 7,950,340 | $ | 7,321,640 | $ | 7,888,183 | ||||||
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Liabilities |
||||||||||||
Payable upon return of securities loaned |
$ | 79,663 | $ | 46,390 | $ | 10,850 | ||||||
Payables: | ||||||||||||
Investment securities purchased |
111,624 | 5,432 | 106,902 | |||||||||
Investment advisory fees |
932 | 767 | 1,159 | |||||||||
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Total Liabilities |
192,219 | 52,589 | 118,911 | |||||||||
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Net Assets, at value |
$ | 7,758,121 | $ | 7,269,051 | $ | 7,769,272 | ||||||
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Net Assets Consist of |
||||||||||||
Paid-in capital |
$ | 7,501,563 | $ | 7,507,639 | $ | 7,485,979 | ||||||
Distributable earnings (loss) |
256,558 | (238,588 | ) | 283,293 | ||||||||
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Net Assets, at value |
$ | 7,758,121 | $ | 7,269,051 | $ | 7,769,272 | ||||||
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Number of Common Shares outstanding |
300,001 | 300,001 | 300,001 | |||||||||
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Net Asset Value |
$ | 25.86 | $ | 24.23 | $ | 25.90 | ||||||
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Investment in non-affiliated securities at cost |
$ | 7,344,717 | $ | 7,494,675 | $ | 6,886,672 | ||||||
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Value of securities loaned |
$ | 254,291 | $ | 47,016 | $ | 705,839 | ||||||
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Investment in DWS Government Money Market Series at cost |
$ | 150,318 | $ | 55 | $ | 608,756 | ||||||
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Investment in DWS Government & Agency Securities Portfolio at cost* |
$ | 79,663 | $ | 46,390 | $ | 10,850 | ||||||
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Non-cash collateral for securities on loan |
$ | 193,484 | $ | 9,989 | $ | 715,375 | ||||||
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Foreign currency at cost |
$ | 105,222 | $ | 8,173 | $ | 29,114 | ||||||
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* | Represents collateral on securities loaned. |
See Notes to Financial Statements. | 30 |
DBX ETF Trust
For the Six Months Ended February 28, 2019 (Unaudited)
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF(1) |
Xtrackers MSCI EAFE ESG Leaders Equity ETF(2) |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF(1) |
||||||||||
Investment Income |
||||||||||||
Unaffiliated dividend income* |
$ | 32,321 | $ | 68,343 | $ | 29,210 | ||||||
Income distribution from affiliated funds |
973 | 30 | 3,492 | |||||||||
Unaffiliated non-cash dividend income |
2,190 | 11,236 | 8,370 | |||||||||
Affiliated securities lending income |
203 | 414 | 14 | |||||||||
Unaffiliated securities lending income, net of borrower rebates |
| | 17 | |||||||||
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Total investment income |
35,687 | 80,023 | 41,103 | |||||||||
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Expenses |
||||||||||||
Investment advisory fees |
2,750 | 4,803 | 3,457 | |||||||||
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Total expenses |
2,750 | 4,803 | 3,457 | |||||||||
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Less fees waived (see note 3): |
||||||||||||
Waiver |
(37 | ) | (1 | ) | (105 | ) | ||||||
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Net Expenses |
2,713 | 4,802 | 3,352 | |||||||||
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Net Investment income (loss) |
32,974 | 75,221 | 37,751 | |||||||||
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Realized and Unrealized Gain (Loss) |
||||||||||||
Net realized gain (loss) from: |
||||||||||||
Investments |
(375 | ) | (7,848 | ) | 2,672 | |||||||
Investments in affiliates |
| (18 | ) | | ||||||||
Futures contracts |
1,007 | | (7,267 | ) | ||||||||
Foreign currency transactions |
4,674 | (2,689 | ) | 17,249 | ||||||||
|
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Net realized gain (loss) |
5,306 | (10,555 | ) | 12,654 | ||||||||
Net change in unrealized appreciation (depreciation) on: |
||||||||||||
Investments |
230,623 | (246,703 | ) | 251,151 | ||||||||
Futures contracts |
(22 | ) | | (79 | ) | |||||||
Foreign currency translations |
961 | 77 | 587 | |||||||||
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Net change in unrealized appreciation (depreciation) |
231,562 | (246,626 | ) | 251,659 | ||||||||
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Net realized and unrealized gain (loss) on investments, futures and foreign currency transactions |
236,868 | (257,181 | ) | 264,313 | ||||||||
|
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Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | 269,842 | $ | (181,960 | ) | $ | 302,064 | |||||
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* Unaffiliated foreign tax withheld |
$ | 3,705 | $ | 6,727 | $ | 4,254 |
(1) | For the period December 6, 2018 (commencement of operations) through February 28, 2019. |
(2) | For the period September 6, 2018 (commencement of operations) through February 28, 2019. |
See Notes to Financial Statements. | 31 |
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
||||||||||
For the Period December 6, 2018(1) to February 28, 2019 |
For the Period September 6, 2018(1) to February 28, 2019 |
For the Period December 6, 2018(1) to February 28, 2019 |
||||||||||
Increase (Decrease) in Net Assets from Operations |
||||||||||||
Net investment income (loss) |
$ | 32,974 | $ | 75,221 | $ | 37,751 | ||||||
Net realized gain (loss) |
5,306 | (10,555 | ) | 12,654 | ||||||||
Net change in net unrealized appreciation (depreciation) |
231,562 | (246,626 | ) | 251,659 | ||||||||
|
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|||||||
Net increase (decrease) in net assets resulting from operations |
269,842 | (181,960 | ) | 302,064 | ||||||||
|
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|
|||||||
Distributions to Shareholders |
(13,284 | ) | (56,628 | ) | (18,771 | ) | ||||||
|
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|
|
|||||||
Fund Shares Transactions |
||||||||||||
Proceeds from shares sold |
7,501,538 | 7,507,614 | 7,485,954 | |||||||||
Value of shares redeemed |
| | | |||||||||
|
|
|
|
|
|
|||||||
Net increase (decrease) in net assets resulting from fund share transactions |
7,501,538 | 7,507,614 | 7,485,954 | |||||||||
|
|
|
|
|
|
|||||||
Total net increase (decrease) in Net Assets |
7,758,096 | 7,269,026 | 7,769,247 | |||||||||
Net Assets |
||||||||||||
Beginning of period |
25 | 25 | 25 | |||||||||
|
|
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|
|
|||||||
End of period |
$ | 7,758,121 | $ | 7,269,051 | $ | 7,769,272 | ||||||
|
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|
|
|
|||||||
Changes in Shares Outstanding |
||||||||||||
Shares outstanding, beginning of period |
1 | 1 | 1 | |||||||||
Shares sold |
300,000 | 300,000 | 300,000 | |||||||||
Shares redeemed |
| | | |||||||||
|
|
|
|
|
|
|||||||
Shares outstanding, end of period |
300,001 | 300,001 | 300,001 | |||||||||
|
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|
|
(1) | Commencement of Operations. |
See Notes to Financial Statements. | 32 |
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF Selected Per Share Data |
Period Ended 2/28/2019(a) |
|||
Net Asset Value, beginning of period |
$ | 25.00 | ||
|
|
|||
Income (loss) from investment operations: | ||||
Net investment income (loss) (c) |
0.11 | |||
Net realized and unrealized gain (loss) |
0.79 | |||
|
|
|||
Total from investment operations |
0.90 | |||
|
|
|||
Less distributions from: | ||||
Net investment income |
(0.04 | ) | ||
|
|
|||
Total distributions |
(0.04 | ) | ||
|
|
|||
Net Asset Value, end of period |
$ | 25.86 | ||
|
|
|||
Total Return (%) |
3.63 | (d)** | ||
Ratios to Average Net Assets and Supplemental Data |
||||
Net Assets, end of period ($ millions) |
8 | |||
Ratio of expenses before fee waiver (%) |
0.16 | * | ||
Ratio of expenses after fee waiver (%) |
0.16 | * | ||
Ratio of net investment income (loss) (%) |
1.92 | * | ||
Portfolio turnover rate (%) (e) |
0 | ** | ||
Xtrackers MSCI EAFE ESG Leaders Equity ETF Selected Per Share Data |
Period Ended 2/28/2019(b) |
|||
Net Asset Value, beginning of period |
$ | 25.00 | ||
|
|
|||
Income (loss) from investment operations: | ||||
Net investment income (loss) (c) |
0.25 | |||
Net realized and unrealized gain (loss) |
(0.83 | ) | ||
|
|
|||
Total from investment operations |
(0.58 | ) | ||
|
|
|||
Less distributions from: |
| |||
Net investment income |
(0.18 | ) | ||
Net realized gains |
(0.01 | ) | ||
|
|
|||
Total distributions |
(0.19 | ) | ||
|
|
|||
Net Asset Value, end of period |
$ | 24.23 | ||
|
|
|||
Total Return (%) |
(2.27 | )(d)** | ||
Ratios to Average Net Assets and Supplemental Data |
||||
Net Assets, end of period ($ millions) |
7 | |||
Ratio of expenses before fee waiver (%) |
0.14 | * | ||
Ratio of expenses after fee waiver (%) |
0.14 | * | ||
Ratio of net investment income (loss) (%) |
2.19 | * | ||
Portfolio turnover rate (%) (e) |
2 | ** |
(a) | For the period December 6, 2018 (commencement of operations) through February 28, 2019. |
(b) | For the period September 6, 2018 (commencement of operations) through February 28, 2019. |
(c) | Based on average shares outstanding during the period. |
(d) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(e) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 33 |
DBX ETF Trust
Financial Highlights (Continued)
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF Selected Per Share Data |
Period Ended 2/28/2019(a) |
|||
Net Asset Value, beginning of period |
$ | 25.00 | ||
|
|
|||
Income (loss) from investment operations: | ||||
Net investment income (loss)(b) |
0.13 | |||
Net realized and unrealized gain (loss) |
0.83 | |||
|
|
|||
Total from investment operations |
0.96 | |||
|
|
|||
Less distributions from: |
| |||
Net investment income |
(0.06 | ) | ||
|
|
|||
Total distributions |
(0.06 | ) | ||
|
|
|||
Net Asset Value, end of period |
$ | 25.90 | ||
|
|
|||
Total Return (%) |
3.87 | (c)** | ||
Ratios to Average Net Assets and Supplemental Data |
||||
Net Assets, end of period ($ millions) |
8 | |||
Ratio of expenses before fee waiver (%) |
0.20 | * | ||
Ratio of expenses after fee waiver (%) |
0.19 | * | ||
Ratio of net investment income (loss) (%) |
2.18 | * | ||
Portfolio turnover rate (%)(d) |
1 | ** |
(a) | For the period December 6, 2018 (commencement of operations) through February 28, 2019. |
(b) | Based on average shares outstanding during the period. |
(c) | Total return would have been lower if certain expenses had not been reimbursed by the Advisor. |
(d) | Portfolio turnover rate does not include securities received or delivered from processing creations or redemptions. |
* | Annualized. |
** | Not Annualized. |
See Notes to Financial Statements. | 34 |
DBX ETF Trust
1. Organization
DBX ETF Trust (the Trust) is registered under the Investment Company Act of 1940, as amended (the Act), as an open-end registered management investment company organized as a Delaware statutory trust.
As of February 28, 2019, the Trust consists of thirty-eight investment series of exchange-traded funds (ETFs) (each a Fund and collectively, the Funds) in operation and trading. These financial statements report on the Funds listed below:
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
DBX Advisors LLC (DBX or the Advisor), an indirect, wholly-owned subsidiary of DWS Group Gmbh & Co. KGaA (DWS Group), serves as investment advisor to the Funds and has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees (Board).
Each Fund offers shares that are listed and traded on the NYSE Arca, Inc. (NYSE Arca). Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value (NAV), only in large specified lots consisting of 50,000 shares, each called a Creation Unit, to authorized participants who have entered into agreements with the Funds distributor. Shares are not individually redeemable securities of the Funds, and owners of the shares may acquire those shares from the Funds, or tender such shares for redemption to the Funds, in Creation Units only.
The investment objective of each Fund is to track the performance, before fees and expenses, of a particular index (the Underlying Index). The underlying indices for the Funds are:
Fund |
Underlying Index | |
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF | MSCI ACWI ex USA ESG Leaders Index | |
Xtrackers MSCI EAFE ESG Leaders Equity ETF Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
MSCI EAFE ESG Leaders Index MSCI Emerging Markets ESG Leaders Index |
The MSCI ACWI ex USA ESG Leaders Index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers. The Underlying Index is constructed using regional indexes that provide exposure to large- and medium-capitalization companies from developed and emerging markets countries (excluding the United States). The Underlying Index is rebalanced quarterly in February, May, August and November, and thus the Fund rebalances its portfolio in a corresponding fashion.
The MSCI EAFE ESG Leaders Index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers. The Underlying Index consists of large- and medium-capitalization companies across developed markets countries, excluding Canada and the United States. The Underlying Index is rebalanced quarterly in February, May, August and November, and thus the Fund rebalances its portfolio in a corresponding fashion.
The MSCI Emerging Markets ESG Leaders Index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (ESG) performance relative to their sector peers. The Underlying Index consists of large- and medium-capitalization companies across emerging markets countries. The Underlying Index is rebalanced quarterly in February, May, August and November, and thus the Fund rebalances its portfolio in a corresponding fashion.
Each Fund is entitled to use its respective Underlying Index pursuant to a licensing agreement between the Index Provider and DBX. There is no charge to the Funds in connection with these licensing agreements.
Each Fund is non-diversified and is not limited by the Act with regard to the percentage of its assets that may be invested in the securities of a single issuer. The securities of a particular issuer (or securities of issuers in particular industries) may dominate the Underlying Index of such a fund and, consequently, the funds investment portfolio. This may adversely affect the funds performance or subject the funds shares to greater price volatility than that experienced by more diversified investment companies.
35
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Pursuant to the Trusts organizational documents, the Trusts officers and trustees are indemnified against certain liabilities that may arise out of the performance of their duties to the Funds. Additionally, in the normal course of business the Trust enters into contracts that contain a variety of representations that provide indemnification for certain liabilities. The Trusts maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Trust expects the risk of loss to be remote.
2. Significant Accounting Policies
The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (U.S. GAAP), which require management to make certain estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. Each Fund qualifies as an investment company under Topic 946 of Accounting Standards Codification of U.S. GAAP. The following is a summary of significant accounting policies followed by the Funds.
Security Valuation The NAV of each Funds shares is calculated each business day as of the close of regular trading on the New York Stock Exchange, generally 4:00 p.m. Eastern Time. NAV per share is calculated by dividing a Funds net assets by the number of Fund shares outstanding.
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the Funds own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities.
Equity securities and ETFs are valued at the most recent sale price or official closing price reported on the exchange (U.S. or foreign) or over-the-counter market on which they trade. Securities or ETFs for which no sales are reported are valued at the calculated mean between the most recent bid and asked quotations on the relevant market or, if a mean cannot be determined, at the most recent bid quotation. Equity securities and ETFs are generally categorized as Level 1.
Investments in open-end investment companies are valued at their NAV each business day and are categorized as Level 1.
Futures contracts are generally valued at the settlement prices established each day on the exchange on which they are traded and are categorized as Level 1.
Securities and other assets for which market quotations are not readily available or for which the above valuation procedures are deemed not to reflect fair value are valued in a manner that is intended to reflect their fair value as determined in accordance with procedures approved by the Board and are generally categorized as Level 3. In accordance with the Funds valuation procedures, factors considered in determining value may include, but are not limited to, the type of the security; the size of the holding; the initial cost of the security; the existence of any contractual restrictions on the securitys disposition; the price and extent of public trading in similar securities of the issuer or of comparable companies; quotations or evaluated prices from broker-dealers and/or pricing services; information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities); an analysis of the companys or issuers financial statements; an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold; and with respect to debt securities, the maturity, coupon, creditworthiness, currency denomination and the movement of the market in which the security is normally traded. The value determined under these procedures may differ from published values for the same securities.
Fair value pricing could result in a difference between the prices used to calculate a Funds NAV and the prices used by the Funds Underlying Index, which in turn could result in a difference between the Funds performance and the performance of the Funds Underlying Index.
Disclosure about the classification of the fair value measurements is included in a table following the Funds Schedule of Investments.
36
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Cash Cash consists of cash held at banks and is on deposit with major financial institutions.
Investment Transactions and Investment Income Investment transactions are recorded as of the date that the securities are purchased or sold (trade date). Realized gains and losses from the sale or disposition of securities are calculated on the identified cost-method. Dividend income is net of any foreign taxes withheld at source. Certain dividends from foreign securities may be recorded subsequent to the ex-dividend date as soon as the fund is informed of such dividends. Interest income is recorded on the accrual basis. Distributions received from foreign domiciled corporations, generally determined to be passive foreign investment companies for tax reporting purposes, are included in dividend income.
Tax Information and Dividends and Distributions to Shareholders It is each Funds policy to comply with all requirements of the Internal Revenue Code of 1986, as amended (the Code). Each fund intends to qualify for and to elect treatment as a separate Regulated Investment Company (RIC) under Subchapter M of the Code. It is the policy each Fund to pay out dividends from net investment income, if any, to investors semi-annually. Taxable net realized gains from investment transactions, reduced by capital loss carryforwards, if any, are declared and distributed to shareholders at least annually. The capital loss carryforward amount, if any, is available to offset future net capital gains. The Funds may occasionally be required to make supplemental distributions at some other time during the year. The Funds reserve the right to declare special distributions if, in their reasonable discretion, such action is necessary or advisable to preserve the status of each Fund as a RIC or to avoid imposition of income or excise taxes on undistributed income. Dividends and distributions to shareholders, if any, are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with Federal income tax regulations which may differ from U.S. GAAP. These book/tax differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified at the end of the year within the components of net assets based on their federal tax treatment; temporary differences do not require reclassification. Dividends and distributions, which exceed earnings and profits for the full year for tax purposes, are reported as a tax return of capital.
In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Funds tax positions taken or expected to be taken on foreign, federal and state income tax returns for all open tax years and has concluded that no provision for income tax is required in the Funds financial statements.
The Funds recognize interest and penalties, if any, related to uncertain tax positions as income tax expense on the Statements of Operations. For the period ended February 28, 2019, the Funds did not incur any interest or penalties.
The tax character of current year distributions will be determined at the end of the current fiscal year.
Foreign Taxes The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, capital gains on investments, certain foreign currency transactions or other corporate events. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which the Funds invest. These foreign taxes, if any, are paid by the Funds and are reflected in their Statements of Operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on capital gains from sales of investments and foreign currency transactions are included in their respective net realized gain (loss) categories, and deferred foreign taxes on unrealized gains are included in net change in unrealized appreciation (depreciation). Foreign taxes payable as of February 28, 2019, if any, are disclosed in the Funds Statements of Assets and Liabilities.
Foreign Currency Translations The books and records of the Funds are maintained in U.S. dollars. Investment securities and other assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the prevailing exchange rates at period end. Purchases and sales of investment securities, income and expenses are translated into U.S. dollars at the prevailing exchange rates on the respective dates of the transactions.
Net realized and unrealized gains and losses on foreign currency transactions represent net gains and losses between trade and settlement dates on securities transactions, the acquisition and disposition of foreign currencies, and the difference between the amount of net investment income accrued and the U.S. dollar amount
37
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
actually received. The portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed, but is included with net realized and unrealized gain/appreciation and loss/depreciation on investments.
Securities Lending The Funds may lend securities to certain financial institutions under the terms of their securities lending agreement. During the term of the loans, the Funds continue to receive interest and dividends generated by the securities and to participate in any changes in their market value. The Funds require the borrowers of the securities to maintain collateral with the Funds consisting of cash and/or securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities having a value at least equal to the value of the securities loaned. When the collateral falls below specified amounts, the lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the securities lending agreement. During the period ended February 28, 2019, the Funds invested the cash collateral into a joint trading account in DWS Government & Agency Securities Portfolio, an affiliated money market fund managed by DWS Investment Management Americas, Inc. DWS Investment Management Americas, Inc. receives a management/administration fee (0.11% annualized effective rate as of February 28, 2019) on the cash collateral invested in DWS Government & Agency Securities Portfolio. The Funds receive compensation for lending its securities either in the form of fees or by earning interest on invested cash collateral net of borrower rebates and fees paid to a lending agent. Either the Fund or the borrower may terminate the loan at any time and the borrower, after notice, is required to return borrowed securities within a standard time period. There may be risks of delay and costs in recovery of securities or even loss of rights in the collateral should the borrower of the securities fail financially. If the Funds are not able to recover securities lent, the Funds may sell the collateral and purchase a replacement investment in the market, incurring the risk that the value of the replacement security is greater than the value of the collateral. The Funds are also subject to all investment risks associated with the reinvestment of any cash collateral received, including, but not limited to, interest rate, credit and liquidity risk associated with such investments.
As of February 28, 2019, the Funds listed below had securities on loan, which were classified as Common Stocks in the Schedule of Investments. The value of the related collateral exceeded the value of the securities loaned at period end.
Remaining Contractual Maturity of the Agreements, as of February 28, 2019 |
||||||||||||||||||||
Securities Lending Transactions | Overnight and Continuous |
<30 Days | Between 30 & 90 days |
>90 days | Total | |||||||||||||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
| |||||||||||||||||||
Common Stocks |
$ | 79,663 | $ | | $ | 113 | $ | 193,371 | $ | 273,147 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 273,147 | |||||||||||||||||
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
| |||||||||||||||||||
Common Stocks |
$ | 46,390 | $ | | $ | 4 | $ | 9,985 | $ | 56,379 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 56,379 | |||||||||||||||||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
| |||||||||||||||||||
Common Stocks |
$ | 10,850 | $ | 16,974 | $ | 26,053 | $ | 672,348 | $ | 726,225 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Gross amount of recognized liabilities for securities lending transactions |
|
$ | 726,225 |
Derivatives
Futures Contracts Each Fund may enter into futures contracts. These futures contracts will be used to simulate investment in the respective Underlying Index, to facilitate trading or to reduce transaction costs. Each Fund will enter into futures contracts that are traded on a U.S. or non-U.S. exchange. No Fund will use futures for speculative purposes. Futures contracts provide for the future sale by one party and purchase by another party of a specified amount of a specific instrument or index at a specified future time and at a specified price. For the period ended February 28, 2019, Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF and Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF utilized futures in order to simulate investment in the Funds Underlying Index. To the extent required by law, liquid assets committed to futures contracts will be maintained.
38
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
At the time each Fund enters into a futures contract, each Fund deposits and maintains as collateral an initial margin with the broker, as required by the exchange on which the transaction is affected. Pursuant to the contract, each Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by each Fund as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for exchange-traded futures contracts is generally less than privately negotiated futures contracts, since the clearinghouse, which is the issuer or counterparty to each exchange-traded future, provides a guarantee of performance. The guarantee is supported by a daily payment system (i.e., margin requirements).
Use of long futures contracts subjects each Fund to risk of loss in excess of the amounts shown on the Statement of Assets and Liabilities, up to the notional value of the futures contracts. Use of short futures contracts subjects each Fund to unlimited risk of loss. Under some circumstances, futures exchanges may establish daily limits on the amount that the price of a futures contract can vary from the previous days settlement price, which could effectively prevent liquidation of unfavorable positions.
A summary of the open futures contracts as of February 28, 2019 is included in a table following the Funds Schedule of Investments.
The following tables summarize the value of the Funds derivative instruments held as of February 28, 2019 and the related location in the accompanying Statement of Assets and Liabilities, presented by primary underlying risk exposure:
Asset Derivatives |
Liability Derivatives |
|||||||||||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF | ||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | | Unrealized depreciation on futures contracts* | $ | 22 | ||||||||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
||||||||||||||
Equity contracts | Unrealized appreciation on futures contracts* | $ | | Unrealized depreciation on futures contracts* | $ | 79 |
* | Includes cumulative appreciation or cumulative depreciation of futures contracts as disclosed in the Schedule of Investments. Unsettled variation margin is disclosed separately within the Statement of Assets and Liabilities. |
Additionally, the amount of realized and unrealized gains and losses on derivative instruments recognized in the Funds earnings during the period ended February 28, 2019 and the related location in the accompanying Statement of Operations is summarized in the following tables by primary underlying risk exposure:
Net Realized Gain (Loss) from: |
||||
Futures Contracts Equity Contracts |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
$ | 1,007 | ||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
(7,267 | ) | ||
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
Futures Contracts Equity Contracts |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
$ | (22 | ) | |
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
(79 | ) |
For the period ended February 28, 2019 the average monthly volume of derivatives was as follows:
Futures Contracts (Contract Value) |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
$ | 233,191 | ||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
665,051 |
39
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
Affiliated Cash Management Vehicles The Funds may invest uninvested cash balances in DWS Government Money Market Series and DWS ESG Liquidity Fund, affiliated money market funds which are managed by DWS Investment Management Americas, Inc. (DIMA), also an indirect, wholly owned subsidiary of DWS Group GmbH & Co. KGaA. Each affiliated money market fund is managed in accordance with Rule 2a-7 under the 1940 Act, which governs the quality, maturity, diversity and liquidity of instruments in which a money market fund may invest. DWS Government Money Market Series seeks to maintain a stable net asset value, and DWS ESG Liquidity Fund maintains a floating net asset value. The Funds indirectly bear their proportionate share of the expenses of each affiliated money market fund in which they invest. The Advisor will waive an amount of the unitary management fee payable to the Advisor by the Funds equal to such acquired funds fees and expenses on the Funds assets invested in the affiliated money market funds.
3. Investment Advisory and Other Agreements
The Advisor has overall responsibility for the general management and administration of the Funds, subject to the supervision of the Funds Board of Trustees. Under an investment advisory agreement between the Trust, on behalf of the Funds, and the Advisor (the Investment Advisory Agreement), the Advisor is responsible for arranging sub-advisory, transfer agency, custody, fund administration, and all other non-distribution related services for the Funds to operate.
For its investment advisory services to the Funds below, the Advisor is entitled to receive a unitary management fee from each Fund based on each Funds average daily net assets, computed and accrued daily and payable monthly, at an annual rate equal to:
Unitary Management Fee |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
0.16 | % | ||
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
0.14 | % | ||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
0.20 | % |
The Advisor for the Funds below has contractually agreed to waive a portion of its management fees in an amount equal to the acquired funds fees and expenses attributable to the Funds investments in affiliated cash management vehicles. For the period ended February 28, 2019, the Advisor waived expenses of the Funds as follows:
Expenses Waived |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
$ | 37 | ||
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
1 | |||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
105 |
Out of the unitary management fee, the Advisor pays substantially all expenses of each Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services, and expenses of the Independent Trustees. Each Fund is responsible for the payment of interest expense, taxes, brokerage expenses, distribution fees or expenses, if any, litigation expenses and extraordinary expenses.
The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as Administrator, Custodian, Accounting Agent, Lending Agent and Transfer Agent for each Fund.
ALPS Distributors, Inc. (the Distributor) serves as the distributor of Creation Units for each Fund on an agency basis. The Distributor does not maintain a secondary market in shares of the Funds.
The Board of Trustees is currently comprised of four Trustees, including three Independent Trustees. The Advisor paid retainer fees and attendance fees to each Independent Trustee; retainer fees to the Chairman of the Board of Trustees and Chairman of the Audit Committee; and attendance fees to each member of the Audit Committee (which is comprised of all of the Funds Independent Trustees).
40
DBX ETF Trust
Notes to Financial Statements (Unaudited) (Continued)
4. Investment Portfolio Transactions
For the period ended February 28, 2019, the cost of investments purchased and proceeds from sale of investments (excluding in-kind transactions and short-term investments) were as follows:
Purchases | Sales | |||||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (1) |
$ | 7,368,210 | $ | 24,694 | ||||
Xtrackers MSCI EAFE ESG Leaders Equity ETF (2) |
7,667,253 | 166,629 | ||||||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (1) |
6,952,212 | 69,447 |
(1) | For the period December 6, 2018 (commencement of operations) through February 28, 2019. |
(2) | For the period September 6, 2018 (commencement of operations) through February 28, 2019. |
5. Fund Share Transactions
As of February 28, 2019, there were unlimited Fund shares, no par value, authorized by the Trust. Fund shares are issued and redeemed by each Fund only in Creation Units or multiples thereof. Except when aggregated in Creation Units, shares of each Fund are not redeemable. Transactions in capital shares for each Fund are disclosed in detail in the Statements of Changes in Net Assets. The consideration for the purchase of Creation Units of a Fund generally consists of the in-kind contribution of a designated portfolio of securities constituting a portfolio sampling representation of the securities included in the respective Funds Underlying Index and an amount of cash, which under certain circumstances may include cash in lieu of portfolio securities. Investors purchasing and redeeming Creation Units pay a purchase transaction fee and a redemption transaction fee to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units.
6. Concentration of Ownership
From time to time, the Funds may have a concentration of several shareholder accounts holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Fund. At February 28, 2019, there was one affiliated shareholder account for each of the funds listed below holding a significant percentage of the shares outstanding:
Approximate Percent of Outstanding Shares Held |
||||
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF |
92 | % | ||
Xtrackers MSCI EAFE ESG Leaders Equity ETF |
98 | % | ||
Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF |
97 | % |
7. Investing in Emerging Markets
The securities of issuers located in emerging markets tend to be more volatile and less liquid than securities of issuers located in more mature economies, and emerging markets generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. The securities of issuers located or doing substantial business in emerging markets are often subject to rapid and large changes in price.
41
DBX ETF Trust
Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF, Xtrackers MSCI EAFE ESG Leaders Equity ETF and Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF
After discussions at the meeting of the Board of Trustees (Board or Trustees) held on February 11-12, 2019 (the Meeting), the Trustees, including the Independent Trustees (those not affiliated with DBX ETF Trust (the Trust) or its service providers), unanimously approved the continuance1 of the Investment Advisory Agreement with respect to Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF, Xtrackers MSCI EAFE ESG Leaders Equity ETF and Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (each a Fund, and collectively, the Funds). The Independent Trustees were advised throughout the review and Meeting by K&L Gates LLP (Independent Trustee Counsel).
Before reaching their decision to approve the Investment Advisory Agreement for another annual period, the Independent Trustees evaluated the materials furnished to them in advance of the Meeting from DBX Advisors LLC (DBX or the Advisor) for purposes of reviewing the agreements terms and also took into consideration the discussions they had with management during the Meeting and among themselves during their Executive Sessions held on February 11 and February 12, 2019. The Independent Trustees also noted that they had received and should take into consideration a substantial amount of information furnished throughout the year at regular Board meetings, which information included, among other things, an analysis of each Funds investment performance and related financial information, presentations given by DBX, as well as its periodic reports on brokerage commissions, portfolio execution and other services provided to the Funds.
In reaching its decision to continue in effect the Investment Advisory Agreement for another annual period, the Board considered all factors it believed relevant, including (1) the nature, extent and quality of the services provided to the Funds and their shareholders; (2) the financial resources of DBX and its resulting ability to perform its obligations under the Investment Advisory Agreement; (3) the competitiveness of the advisory fee; (4) the total cost of the services provided by and the profits realized by the Advisor from its relationship with the Funds; (5) the extent to which economies of scale have been realized, and if the Funds shareholders have benefitted from those economies; and (6) fall out benefits, if any, enjoyed by the Advisor.
The Board reached a determination, with the assistance of Dechert LLP (Trust Counsel) and through the exercise of its business judgment, that approval of the Investment Advisory Agreement and the compensation to be received thereunder is in the best interests of each Fund and its shareholders as well as consistent with the Boards duties under state and federal law. The Board reached this conclusion based on multiple factors.
Nature, Extent and Quality of Services. The Board reviewed in detail the nature, extent and quality of services provided by the Advisor under the Investment Advisory Agreement. In doing so, the Board considered the information it had received from and the discussions it had with the Advisor continuously during the prior year, in addition to the information the Advisor had provided in response to the Boards requests prior to the Meeting. The Board considered that these services include, among other things, furnishing a continuous investment program for the Funds, including arranging for, or implementing, the purchase and sale of portfolio securities, the provision of general corporate services such as portfolio management compliance services and the preparation and filing of certain reports on behalf of the Trust. The Board also considered, among other things, the professional experience, qualifications and performance of the senior management and key professional personnel of the Advisor, including portfolio management.
The Board considered that the Advisor provides, at its own expense, office facilities and equipment for use by the Funds and supervisory persons responsible for supervising and monitoring the Trusts service providers. The Board also considered that the Advisor pays or arranges for the compensation of officers of the Trust who are also officers or employees of the Advisor or one of its Deutsche Bank affiliates, except as may otherwise be determined by the Board. In addition, the Board considered that the Advisor arranges for the provision of transfer agency, custody, fund administration and accounting, and other non-distribution services necessary for the Funds operations. The Board also considered that in addition to managing the Funds portfolios directly, the Advisor provides oversight of day-to-day operations, including monitoring tracking error, providing services in
1 At a meeting held on November 14, 2017, the Board, including the Independent Trustees (those not affiliated with the Trust or its service providers), unanimously approved the initial Investment Advisory Agreement with the Funds.
42
DBX ETF Trust
Board Considerations in Approval of Investment Advisory Contracts (Unaudited) (Continued)
connection with the creation and redemption of creation units and assistance in meeting legal, compliance and regulatory requirements applicable to the Funds. The Trustees took into consideration that tracking error for each Fund during the year was in an expected range.
Based on its review, the Board concluded that the nature, extent, and quality of services provided by the Advisor under the Investment Advisory Agreement are reasonable and appropriate in relation to the fees paid to the Advisor, taking special consideration of the fact that the advisory fee is a unitary fee and, as a result, a portion of the unitary advisory fee will be used to compensate the Funds service providers. The Board considered the staffing of the Advisor, including the training, qualifications and experience of investment personnel in managing the Funds. The Board also considered the expertise of the Advisor in supervising third party service providers to the Funds, such as the administrator and the custodian, noting the Advisors extensive work with these service providers (including onsite due diligence sessions) to conduct such supervision. The Board further considered the compliance program of the Advisor, which supports the Funds compliance program.
Advisors Financial Resources. In connection with the assessment of the ability of the Advisor to perform its duties under the Investment Advisory Agreement, the Board considered the Advisors financial condition and whether it has the resources necessary to carry out its functions. The Board concluded that the Advisor has the financial resources necessary to perform its obligations under the Investment Advisory Agreement.
Reasonableness of Advisory Fee. The Board compared each Funds advisory fee to that of other pertinent exchange-traded funds (ETFs) and noted that each Funds fee is competitive with the fees of its respective peer group. The Board agreed that it was familiar with the Advisors methodology for selecting each Funds peer group and believed that the Funds peer groups were appropriate. The Board considered that the fee for each of the Funds is a unitary fee pursuant to which the Advisor pays all of the Funds costs (subject to certain specified exceptions). The Board also considered that each Funds portfolio is managed on a day-to-day basis by the Advisor and that the Advisor also provides oversight of day-to-day operations, including monitoring tracking error, providing services in connection with creation and redemption units and assistance in meeting legal and regulatory requirements applicable to the Funds. Based on its review, the Board concluded that the advisory fee for each Fund is reasonable in light of the services provided.
Costs of Services and Profitability. The Board considered the expenses of the Advisor in developing and rendering services provided to the Funds and the information provided by the Advisor to the Board regarding the Funds profitability. The Board considered that the Advisor had provided extensive information about the Advisors profitability and the Advisors methodology in determining profitability. While the Advisor had provided information about the Advisors expenses relating to marketing the Funds, the Board considered the Advisors profitability without accounting for such expenses. The Board determined that, although only some of the Funds were profitable as of this time, the Advisors profitability with respect to each profitable Fund was not excessive. The Board considered whether the Advisor would benefit in other ways from its relationships with the Funds and concluded that there were no material fall-out benefits likely to accrue to the Advisor related to the operation of the Funds.
Economies of Scale. The Board considered that certain Funds had attracted a substantial amount of assets, but determined that those Funds were not experiencing economies of scale beyond what was reflected in each Funds unitary fee, which the Board noted was very competitive. The Board considered that the other Funds were not experiencing economies of scale at this time and determined to revisit this matter after the Funds had attracted more assets.
Given all the information available to it and considering all material factors, the Board concluded that the Investment Advisory Agreement was fair and reasonable and it was unanimously approved.
43
DBX ETF Trust
Proxy Voting Policies and Procedures
The Funds policies and procedures for voting proxies for portfolio securities and information about how each Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 are available on our Web site www.Xtrackers.com (click on Resources and Proxy Voting at the top of the page) or on the SECs Web site www.sec.gov. To obtain a written copy of the Funds policies and procedures without charge, upon request, call us toll free at (855) 329-3837.
Quarterly Portfolio Disclosure
The Funds are required to file their complete schedule of portfolio holdings with the SEC for their first and third fiscal quarters on Form N-Q or Form N-PORT (available for filings after March 31, 2019). Copies of the filings are available without charge, upon request on the SECs website at www.sec.gov and are available by calling the Trust at 855-329-3837.
Information about each Funds portfolio holdings is available daily at www.Xtrackers.com.
Discount & Premium Information
Information regarding how often shares of each Fund traded on NYSE Arca at a price above (i.e.,at a premium) or below (i.e., at a discount) the NAV of the Fund can be found at www.Xtrackers.com.
44
DBX ETF Trust
DBX Advisors LLC (Advisors) collects non-public information about you from the following sources: (i) information received from you on applications or other forms; and (ii) information about your transactions with the Advisors, Advisors affiliates and third-party service providers and vendors. Advisors does not disclose any non-public personal information about you to anyone, other than as set forth below, as permitted by applicable law and regulation. Advisors may disclose non-public personal information about you to the funds in which you invest, to Advisors affiliates, and to non-affiliated companies that work with Advisors to service your account(s), or to provide services or process transactions that you have requested. Advisors may disclose non-public personal information in situations that may include, but are not limited to, in response to legal and/or regulatory inquiries and the proposed or actual sale, assignment merger or other transfer of all or a portion of Advisors business to another business entity. Advisors may also disclose non-public personal information about you to parties representing you, such as your investment representative, your accountant, your tax advisor, or to other third parties at your direction/consent. Advisors will not sell, rent, license or trade your personal and financial information to or with third parties for their own direct marketing use unless you give us general or specific consent to do so. If you decide to close your account(s) or become an inactive customer, Advisors will adhere to the privacy policies and practices as described in this notice. Advisors restricts access to your personal and account information to those employees who need to know that information to provide products and services to you. Advisors maintains reasonable and customary physical, electronic and procedural safeguards to guard your non-public personal information.
Advisors reserves the right, at their discretion, to change, modify, add, or remove portions of this Privacy Policy Notice, and any of the policies described herein, at any time. Advisors will indicate any such changes to the Privacy Policy Notice at the privacy link which can be found at www.Xtrackers.com. At all times, you are bound by the then-current version of the Privacy Policy and all applicable laws. Advisors highly recommends that you review this Privacy Policy Notice from time to time to ensure that you are familiar with the most recent version. The examples contained in this Privacy Policy Notice are illustrations; they are not intended to be exclusive.
45
DBX ETF Trust
This report is intended for the shareholders of the DBX ETF Trust.
This report must be preceded or accompanied by a prospectus.
Investing involves risk, including the possible loss of principal. ESG criteria in a Funds investment strategy does not guarantee a return or protect against loss. Stocks may decline in value. Foreign investing involves greater and different risks than investing in US companies, including currency fluctuations, less liquidity, less developed or less efficient trading markets, lack of comprehensive company information, political instability and differing auditing and legal standards. With respect to EMSG and ACSG, emerging markets tend to be more volatile and less liquid than the markets of more mature economies, and generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. These Funds are non-diversified and can take larger positions in fewer issues, increasing its potential risk. Performance of a Fund may diverge from that of its Underlying Index due to operating expenses, transaction costs, cash flows, use of sampling strategies or operational inefficiencies. An investment in any Fund should be considered only as a supplement to a complete investment program for those investors willing to accept the risks associated with the Fund. Please read the prospectus for more information.
Shares of the Funds are bought and sold at market price (not NAV) throughout the day on the NYSE Arca, Inc. Transactions in Fund shares may result in brokerage commissions and may generate tax consequences. There can be no assurance that an active trading market for shares of a Fund will develop or be maintained.
DBX ETF Trust Funds are distributed by ALPS Distributors, Inc. (ALPS). The Funds are managed by DBX Advisors LLC which is not affiliated with ALPS.
The brand DWS represents DWS Group GmbH & Co. KGaA and any of its subsidiaries such as DWS Distributors, Inc. which offers investment products or Deutsche Investment Management Americas Inc. and RREEF America L.L.C. which offer advisory services.
The Funds or securities referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such Funds or securities or any index on which such Funds or securities are based. The prospectus contains a more detailed description of the limited relationship MSCI has with DBX and any related funds.
Copyright © 2019 DWS Group. All rights reserved. XtrackersTM is a trademark of DWS Investment GmbH. All other trademarks, servicemarks or registered trademarks are the property of their respective owners.
Not FDIC Insured | No Bank Guarantee | May Lose Value
DBX ETF Trust
Investment advisor DBX Advisors LLC 345 Park Avenue New York, NY 10154 |
Administrator, custodian, The Bank of New York Mellon 240 Greenwich Street New York, NY 10286 |
Distributor ALPS Distributors, Inc. 1290 Broadway Suite 1100 Denver, CO 80203 | ||
Independent registered public accounting firm Ernst & Young LLP 5 Times Square New York, NY 10036 |
Legal counsel Dechert LLP 1095 Avenue of the Americas New York, NY 10036 |
R-065808-1 (4/19) DBX003835 (4/20)
Item 2. | Code of Ethics. |
Not applicable.
Item 3. | Audit Committee Financial Expert. |
Not applicable.
Item 4. | Principal Accountant Fees and Services. |
Not applicable.
Item 5. | Audit Committee of Listed Registrants. |
Not applicable.
Item 6. | Investments. |
(a) | Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form. |
(b) | Not applicable. |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Not applicable.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
Not applicable.
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Not applicable.
Item 10. | Submission of Matters to a Vote of Security Holders. |
There were no material changes to the procedures by which shareholders may recommend nominees to the Registrants Board of Trustees.
[Please verify, please provide further information if this statement is not correct.]
Item 11. | Controls and Procedures. |
(a) | The Chief Executive and Financial Officers concluded that the Registrants Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report. |
(b) | There were no changes in the registrants internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d))) that occurred during the registrants last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting. |
Item 12. | Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. |
Not applicable.
Item 13. | Exhibits. |
(a)(1) | Not applicable. | |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. | |
(a)(3) | Not applicable. | |
(a)(4) | Not applicable. | |
(b) | Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) DBX ETF Trust
By (Signature and Title)* | /s/ Freddi Klassen | |
Freddi Klassen | ||
President and Chief Executive Officer |
Date 5/3/2019
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)* | /s/ Freddi Klassen | |
Freddi Klassen | ||
President and Chief Executive Officer |
Date 5/3/2019
By (Signature and Title)* | /s/ Michael Gilligan | |
Michael Gilligan | ||
Treasurer, Chief Financial Officer and Controller |
Date 5/3/2019
* | Print the name and title of each signing officer under his or her signature. |
Certification Pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the
Sarbanes-Oxley Act
I, Freddi Klassen, certify that:
1. | I have reviewed this report on Form N-CSR of DBX ETF Trust; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has |
materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: 5/3/2019 | /s/ Freddi Klassen | |||||
Freddi Klassen | ||||||
President and Chief Executive Officer |
Certification Pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the
Sarbanes-Oxley Act
I, Michael Gilligan, certify that:
1. | I have reviewed this report on Form N-CSR of DBX ETF Trust; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: 5/3/2019 | /s/ Michael Gilligan | |||||
Michael Gilligan | ||||||
Treasurer, Chief Financial Officer and Controller |
Certification Pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the
Sarbanes-Oxley Act
President
Section 906 Certification under Sarbanes Oxley Act
I, Freddi Klassen, certify that:
1. | I have reviewed this report, filed on behalf of DBX ETF Trust, on Form N-CSRS; |
2. | Based on my knowledge and pursuant to 18 U.S.C. § 1350, the periodic report on Form N-CSRS (the Report) fully complies with the requirements of § 13 (a) or § 15 (d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Trust. |
Date: 5/3/2019 | /s/ Freddi Klassen | |||||
Freddi Klassen | ||||||
President and Chief Executive Officer |
Chief Financial Officer and Controller
Section 906 Certification under Sarbanes Oxley Act
I, Michael Gilligan, certify that:
1. | I have reviewed this report, filed on behalf of DBX ETF Trust, on Form N-CSRS; |
2. | Based on my knowledge and pursuant to 18 U.S.C. § 1350, the periodic report on Form N-CSRS (the Report) fully complies with the requirements of § 13 (a) or § 15 (d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Trust. |
Date: 5/3/2019 | /s/ Michael Gilligan | |||||
Michael Gilligan | ||||||
Treasurer, Chief Financial Officer and Controller |
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