XTrackers MSCI Pakistan Swap UCITS ETF 1C
| Issuer: Xtrackers |
| Asset Class: Equity |
| TER: 85bps |
| Trading Currency: USD |
| Pays Income: False |
| Listing Date: 11 Jun 2012 |
| Ticker: XBAK |
| ISIN: LU0659579147 |
This investment product offers targeted exposure to the Pakistani equity market, a component of the MSCI Frontier Markets classification. Pakistan possesses significant long-term growth potential, underpinned by favorable demographics, including a large and youthful population, and its strategic geographic location at the crossroads of South Asia, Central Asia, and the Middle East. The country's economy is diversified across sectors such as textiles, agriculture, information technology, and financial services. For investors seeking to tap into economies with high-growth trajectories, this fund provides a direct avenue to participate in Pakistan's economic development and the performance of its leading publicly traded companies.
The fund is designed to replicate the performance of the MSCI Pakistan Investable Market Index (IMI), which captures the large, mid, and small-cap segments of the Pakistani equity universe. This comprehensive approach ensures broad representation of the market's various industries and company sizes. By utilizing a swap-based, or synthetic, replication methodology, the fund aims to track the index's returns closely and efficiently, minimizing tracking error. This structure can be particularly effective in markets that may present liquidity challenges or foreign ownership restrictions, offering a practical way to gain the desired exposure.
Investing in a single frontier market like Pakistan involves a higher degree of risk compared to developed or even broader emerging market investments. Potential investors should be aware of risks including political instability, regulatory changes, and significant currency volatility. The performance can be highly sensitive to local economic conditions and geopolitical events. Consequently, this financial instrument is best suited for experienced investors with a high-risk tolerance and a long-term perspective, who are looking to add a tactical, high-growth component to a well-diversified global portfolio.
