Daiwa Securities and Global X to establish a JV to expand domestic ETF business

TOKYO, JAPAN: Daiwa Securities Group Inc., Daiwa Asset Management Co. Ltd. and Global X Management Company Inc. will collaborate in the asset management business, and establish a joint venture (JV), Global X Japan Co. Ltd., to support their customers’ asset building through their new Exchange Traded Fund (ETF) solutions to investors in Japan.

The global ETF market continues to expand due to product benefits that include lower cost and higher liquidity. Especially in the US market, the investor base has expanded with individual investors holding more than 50% of the assets. ETF assets under management in the US have grown from circa $500 billion 10 years ago to more than $3 trillion as of December 2018.

In Japan, although the presence of ETFs in publicly offered stock investment trusts has been increasing year-by-year, the market is still developing, with more than 50% of personal financial assets (exceeding 1,800 trillion yen) held in cash.

It is expected that various types of financial products will be required for the progress from savings to asset building, and the investment need for low-cost, highly flexible ETF will increase.

In light of this opportunity, Global X Japan Co. Ltd. has entered the developing domestic Exchange Traded Fund (ETF) market and plans to introduce differentiated ETF products, mainly thematic and income-oriented solutions, to serve growing demand.

Global X has an established product development process, longstanding index provider relationships, as well as proven operational, sales and marketing expertise in the US. Also, with its wide recognition in the United States, the firm has a strong brand.

Daiwa Securities Group Inc. has been developing products and service platforms that meet the needs of a wide range of investors. By collaborating with Global X, which has an excellent track record for leadership in thematic investing, the Group is well-positioned to offer differentiated Exchange Traded Fund (ETF) solutions to its individual investor customers.

Daiwa Securities Group Inc. will provide strong support to the progression “from savings to asset building” in Japan.

Daiwa Securities Group Inc. and Global X will leverage their strengths to contribute to the realization of a better life for their customers and a better society.

At present, Daiwa Securities Group Inc. is the only founder to swiftly complete the company establishment process so far. Once the necessary preparations are completed, the three companies will promptly increase capital to 5 billion yen (including capital reserve).

Edited by Nayyar Iqbal

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