State Street Global Advisors (SSGA) has launched four advanced beta equity exchange-traded funds (ETFs) on Deutsche Borse’s Xetra.
The SPDR MSCI Europe Value Weighted UCITS ETF, SPDR MSCI USA Value Weighted UCITS ETF, SPDR MSCI Europe Small Cap Value Weighted UCITS ETF and SPDR MSCI USA Small Cap Value Weighted UCITS ETF track the MSCI Value Weighted Indicies.
The four ETFs follow a methodology that reweights all stocks from the parent indices based on four financial metrics – sales, book value, earnings and cash earnings. Using these measures, the indices are tilted towards those stocks with the lowest valuation characteristics.
Edwin Mars (pictured), Senior Sales Manager IBG ETF (SPDR) Benelux, says: “The growth of advanced beta has been huge over the past decade with global assets increasing fivefold since 2008.
“Investors are looking for new ways to access sources of return while managing equity market risk. Advanced beta strategies, which seek to isolate factors that have been shown to outperform standard market cap-weighted indices over time, respond directly to this demand.
“These new funds allow investors to gain exposure to the value premium across large, mid or small-cap exposures in both the US and Europe, while benefiting from the liquidity, transparency and flexibility of ETFs.”
Deborah Yang, managing director, MSCI Index Business Unit, EMEA and South Asia, says: “MSCI is delighted that SSGA chose to license the MSCI Value Weighted Indices for its range of SSGA advanced beta equity ETFs. MSCI’s factor indices are designed to provide consistent and accurate benchmarks in this rapidly expanding index sector.”
These ETFs add to SSGA’s existing advanced beta equity range which includes five mutual funds and 13 ETFs.