db X-trackers: etfs which reinvest the dividends or are they a different alltogether?

A

ALBERT*

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Are these essentially etfs which reinvest the dividends or are they a different type of product altogether?
 
X-Tracker is product name for [broken link removed]. Like most European AMs, they offer both distributing and capitalising versions of their ETFs. So be sure to you buy the type that suits your purpose - the column titled 'use of profits' indicates the type of ETF.
 
Use of profits refers to dividends? Capitalising means they are added automatically to the capital amount?
If I use an online broker, am I charged for a transaction when the dividends are added to the capital or does DAWM do it automatically and its free?
 
There is a golden rule of investment that has been written here by many in the past-if you don't understand the investment, the wisest thing is not to invest!
 
Strangely, you would think that is part of the advice, but it's not!

Lots of threads here about people investing in schemes, finds, derivatives etc and then getting nasty shocks on fees, costs, admin or worse, performance.

The advice stands, if too have to ask what it is, then it's not for you!
 
Luternau said:
The advice stands, if too have to ask what it is, then it's not for you!
Click to expand...

The advice was if you don't understand an investment product, don't investand not as you seem to think - "if you d'not understand an investment product d'not ask"

That would make no sense at all! How would people ever learn by following that logic.
 
ALBERT* said:
Use of profits refers to dividends? Capitalising means they are added automatically to the capital amount?
If I use an online broker, am I charged for a transaction when the dividends are added to the capital or does DAWM do it automatically and its free?
Click to expand...

'Capitalising' is poor translation on the part of DB, what actually happens is that any income generated by the instruments in the fund are reinvested by the fund as opposed to being distributed. Any costs associated with such work is reflected in the TER of the fund.

Your broker should not make any charge for this as he has no work to do when this happens and normally he would not get any information from the fund about such things.

But having said that it is always a good idea to familiarize yourself with all the fees charged by your broker.
 
I stated the best advice going....! (post 5 Jim) People are of course free to ask as many q as they want, but it still gets back to if you don't understand....
 
Inspired! But even more off topic. Don't see what has got under your skin. By all means explain the investment, does not change my post!
 
Jim2007 said:
'Capitalising' is poor translation on the part of DB, what actually happens is that any income generated by the instruments in the fund are reinvested by the fund as opposed to being distributed. Any costs associated with such work is reflected in the TER of the fund.

Your broker should not make any charge for this as he has no work to do when this happens and normally he would not get any information from the fund about such things.

But having said that it is always a good idea to familiarize yourself with all the fees charged by your broker.
Click to expand...

Cheers. For longterm investers the difference between capitalising dividends and distributing dividends is huge in terms of the final capital amount.
I intend to make a post trying to tease out all the extra costs involved in buying an etf from an online broker next week. If buying outside the London Stock exchange there is a litany on extra t&cs involved.
 
db x-trackers

I believe these tracker are synthectic index type, in that they might not alway buy the underlying assets of the chosen index. Might want to look up synthectic tracking...its an extra complication in my opionion.
Vanguard, dont use this technique in their trackers! that usually says something...
 
Actually just checked their website, they do have some physical tracking ETFs, but most seem to be of the synthetic type.
Below is the terminology they use;
Direct Replication (Physical) - What Vanguard would do
Indirect Replication (Swap) otherwise known as synthetic tracking
 
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Vanguard also market SWAP type products, although I've none seen any introduced to European markets yet, but it is early days.
 
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