Invesco has launched the first ETF in Europe designed to track the MSCI World Equal Weight index, aimed at investors who are concerned over concentration risk in their portfolios.
With the combined weight of the top 10 holdings in the standard MSCI World index currently at 25%, the highest level of concentration in over 40 years, the strategy will aim to offer reduced exposure to the ‘Magnificent Seven’ US tech stocks compared to a market-cap tracker.
The equal weight index is made up of over 1,400 stocks of large and mid-cap names across 23 developed markets.
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The Invesco MSCI World Equal Weight UCITS ETF will charge an annual 0.20%.
Gary Buxton, head of Emea and Apac ETFs and indexed strategies at Invesco, said: “The sharp equity market sell-off in July – while relatively short-lived – provided a timely reminder of just how quickly individual company fortunes and investor sentiment can change.
“Our new ETF offers investors a sensible way to maintain broad exposure to global equity markets, but with reduced sensitivity to the performance of any individual company.”
