UBS ETF launches one new S&P 500 Equal Weight Acc ETF on the LSE

UBS Asset Management (UBS AM) announces the launch of a new UCITS ETF which provides exposure to the S&P 500 Equal Weight Index. This index includes the same 500 companies as the market capitalization weighted S&P 500, however each underlying stock is allocated an equal and fixed weight (0.2%).

S&P’s equal weight index provides a solution for investors with concerns over sector or security level concentration in the S&P 500. Recently, the ten largest stocks within the S&P 500 reached an all-time high at over 35% of the index’s market value; similarly, the technology sector also represents a weight of over 30% of the S&P 500¹.

The UBS S&P 500 Equal Weight SF UCITS ETF synthetically replicates the performance of the index: the fund holds an portfolio of equities and matches the performance of the S&P 500 Equal Weight Index through its swap-based setup. While all investments are subject to market fluctuations, an advantage of this synthetic replication is that at present the ETF benefits from an exemption to pay US dividend withholding taxes.

Clemens Reuter, Head ETF & Index Fund Client Coverage, UBS Asset Management said: “Given the current elevated level of concentration in US market-cap weighted indices, we are delighted to offer our clients an alternative with the UBS S&P 500 Equal Weight ETF. Investors will further benefit as the ETF is synthetically replicated, and is therefore currently exempt from withholding tax on US dividends.”

UBS ETF (IE) S&P 500 Equal Weight SF UCITS ETF $ACC

The investment objective is to replicate the performance of the S&P 500 Equal Weight Index.

The fund synthetically replicates the index performance by investing in a swap.

The swap counterparty transfers collateral to the ETF in the form of G10 government bonds, supranational bonds and cash.