European investors can now have a choice of two exchange-traded funds (ETF) tied to the popular Dow Jones-AIG Commodity Index. INDEXCHANGE Investment AG launched the Dow Jones-AIG Commodity SwapEX on August 21 on the Deutsche Borse's XTF segment. The new fund kicked off trading with nearly €20 million in assets.  

ETF Securities currently trades an ETF tracking the index - the ETFS All Comodities DJAIGCI (ticker AIGC on the LSE, Euronext, the Deutsche Borse and the Bolsa Italiana), and Barclays Capital's iPath DJAIG ETN (DJP) in the U.S. is currently the world's largest exchange traded commodity basket product, with nearly $2 billion in assets.

The DJ-AIG Commodity Index is popular with investors who shy away from the high energy weightings in the S&P GSCI, the most popular commodity index. While the GSCI holds nearly 70% of its portfolio in energy futures, the DJ-AIG caps its energy exposure at 33% of the index. Moreover, as explored in this HardAssetsInvestor.com article, that energy exposure features equal weights of natural gas and oil, whereas the GSCI is dominated by oil exposure - two very very different markets. So far this year, the two indexes have performed similarly, but with such different weights and components, that will not always be the case. The new fund fills a vacancy in INDEXCHANGE's broad offering of ETFs, which does not include any other commodity-based products.

Lyxor's currently markets two commodity ETFs in Europe: one tracking the broad-basedCommodities Research Bureau (CRB) index and one tracking the ex-energy sub-index. The funds trade on the Euronext, Borsa Italiana and Deutsche Borse exchanges.

EasyETF is offers five commodity ETFs tracking different versions of the aforementioned GSCI. The broad-based EasyETF GSCI was the first commodity ETF to trade in Europe and is currently listed on the Deutsche Boerse and the SWX. It is available in two versions-one denominated in euros and one in dollars. The other three funds are all listed on the Deutsche Borse and are based on subsets of the S&P GSCI. One tracks the agriculture and livestock segments, while another excludes energy-related commodities. The third one includes energy-related commodities but weights them more lightly than in the traditional GSCI.

The new INDEXCHANGE fund has an expense ratio of 0.45%, as do the EasyETF products.The Lyxor are the cost leaders, with expense ratios of just 0.35%. All are below the typical 0.75% expense ratio for U.S. funds.

The DJ-AIG Commodity SwapEX is INDEXCHANGE's eightieth fund. The firm was bought last year from Bayerische Hypo- und Vereinsbank AG by Barclays Bank, which is responsible for the iShares ETFs through its Barclays Global Investors (BGI) subsidiary.

A prospectus for the DJ-AIG Commodity SwapEx can be found here.