Business Forum • 23 May, 2024 at 10:37 AM
InterCapital Asset Management, Croatia's largest independent asset manager with €500 million in assets under management, and Investimental, the newest broker on the Romanian capital market, announce the launch of a new Exchange Traded Fund (ETF) tracking the BET-TRN index. The newest ETF on the local capital market will start trading on the Bucharest Stock Exchange on May 29th, 2024, with symbol ICBETNETF.
“We are thrilled to introduce a new ETF on the Bucharest Stock Exchange, making exposure to one of the region's best-performing stock indices accessible to the general public. The Romanian capital market has seen stellar growth over the past 15 years since we began investing directly via our funds in local companies. As of May 29th, we will further invigorate this vibrant market by providing an accessible way for the retail investors to gain fast and accessible exposure to the most liquid and dynamic companies. Moreover, we are proud that this ETF is the first on the Bucharest Stock Exchange that is also tradable on other exchanges, in Zagreb and Ljubljana, thereby fulfilling our promise to promote the Romanian capital market internationally,” stated Ivan Kurtovic, Chairman of the Management Board at InterCapital Asset Management.
The new ETF will track the performance of the BET-TRN index, which includes 20 Romanian blue-chip companies such as Banca Transilvania, Hidroelectrica, OMV Petrom, and DIGI Communications. BET-TRN stands for "Total Return Net," meaning the index reflects not only the price movements of the blue-chips but also assumes that net dividends are reinvested. Consequently, dividends received will be automatically reinvested in the stocks that paid them. The price of one fund unit on the first day of trading, May 29th, will be around RON 70, offering an affordable way to gain exposure to the BET index. For comparison, the estimated cost of replicating the BET index by a retail investor is approximately RON 21,500, excluding trading fees.
Mihaela Bîciu, CEO of Investimental, commented: "We are excited to bring the InterCapital BET-TRN UCITS ETF to Romanian investors, allowing for an even greater participation of individual investors in the local capital market. This ETF offers an incredibly affordable way for the general public to invest in top Romanian companies, with a fund unit being available for less than RON 100 each. Thanks to the competitive pricing, it is currently the most cost-effective method for individuals to gain exposure to our thriving capital market, and the reinvestment of dividends directly enhances the growth potential of their investment. This makes it an effortless and efficient wealth accumulation tool for everyone, regardless of their investment experience. We believe this ETF is a significant step in making the benefits of the stock market accessible to all and we look forward to being able to offer it for all investors starting with May 29th, 2024."
With the launch of the new ETF, Investimental, the Market Maker for the ETF, will offer clients a lowered trading fee for an undetermined period. Thus, Investors will be able to buy the ETF paying a reduced trading commission of 0.26%, in addition to the standard ASF commission of 0.04%. With a total commission of 0.3%, purchasing BET-TRN UCITS via Investimental will be thus the cheapest way for the public to gain exposure to the Romanian capital markets. The investors will be able to buy fund units in the BET-TRN UCITS via all intermediaries that are authorized on the Bucharest Stock Exchange, at standard fees.
Separate to the trading fee applicable upon purchasing the fund units, InterCapital will also apply management cost of 0.6%, giving a total expense ratio of below 1% annually. Keeping costs low ensures that investors effectively benefit from market performance, maximizing the growth potential of their investments.
The current assets under management of the ETF that tracks BET-TRN have surpassed €8 million since InterCapital Asset Management has already launched the ETF on the BET-TRN index in the region, with the ETF being traded in euros on the Zagreb Stock Exchange since May 31st, 2023, and on the Ljubljana Stock Exchange since January 23rd, 2024. InterCapital expects that the assets under management will exceed €30 million by the end of 2024, driven by both local and international demand.
Since the beginning of 2024, the BET-TRN index has registered a 16.45% increase, outperforming the S&P 500 and STOXX Europe 600, driven by strong performances from both defensive stocks and entrepreneurial companies included in the BET index.