Clearstream is offering investors direct access to the PIMCO Source ETF through Vestima, the ICSD’s global fund processing platform. The ETF listed on the Deutsche Börse today.
Investors are now able to directly buy and sell shares in this ETF through Vestima in the same way as for a mutual fund, wherby Vestima routes orders to the fund’s registrar. The PIMCO Covered Bond Source UCITS ETF is the first ETF directly available on Vestima at end-of-day NAV, thus providing additional access to this fund.
“There has been increasing demand over the last 12-18 months from investors [using Vestima] to be able to buy into ETFs. These types of investors find ETFs are more attractive in terms of return, composition, and various other factors…things like the way mutual funds are distributed relies on trailer fees. This is affecting what investors want to invest in,” says Allan Stewart, product manager in product management for Clearsteam’s Investment Fund Services.
The improved access to ETFs on Vestima is part of Clearstream’s new issuance model for ETF’s, which aims to streamline fund issuance and processing. The recent announcement of the collaboration with Capita Asset Services, an Irish registrar, to make cross-border transactions for Irish ETFs more secure and streamlined in the German market constituted another key milestone.
“Vestima reduces the execution complexities for those investors who utilize both ETFs and mutual funds in their investment portfolios,” says Howard Chan, vice president and product manager for PIMCO’s ETF products.
Philippe Seyll head of Investment Funds Services, says: “We are pleased to introduce the first actively managed covered bond ETF, managed by PIMCO, onto our Vestima platform, which currently gives access to more than 125,000 mutual funds. Our objective is to provide investors with a standardized process for all their fund transactions—from mutual funds to ETFs and hedge funds—by using the same platform.”
Clearstream is currently working with the broader community of ETF promoters to enable direct access to a broader range of ETFs, thereby replicating the model of the PIMCO Source ETF launch.
“The way forward sit with other ETF issuers; we have been talking to many and hopefully we’ll manage to find a way to connect to their registrar. Another approach is to connect to the authorized participants. So that person would still act as a broker but they would also accept or receive orders from our platform. That may materialize,” says Stewart.
Clearstream Introduces First Actively Managed Covered Bond ETF on Vestima Platform
The improved access to ETFs on Vestima is part of Clearstream’s new issuance model for ETF’s, which aims to streamline fund issuance and processing.