Xact has listed the first Nordic smart beta ETF, which tracks stable, dividend-paying equities. The fund, XACT Nordic High Dividend Low Volatility, tracks an index that combines dividends and stable returns. This strategy is used by major institutional investors on the one hand and private savers on the other, and is particularly attractive when traditional low risk investments provide no – or very low – returns.
Complementing dividends with the “low risk” factor (i.e. low volatility in the share) creates the basis for the index to identify stable, dividend-paying stocks – a strategy that has historically provided stronger returns than a traditionally market value-weighted index.
“It’s very pleasing today to list XACT Nordic High Dividend Low Volatility, and to bring the first Nordic smart beta ETF to the market. With our new ETF we aim to meet the market’s demand for stable, dividend-paying equities with a smart exposure in a smart format – and also at a low cost,” says Pär Nürnberg, Chief Executive of Xact Kapitalförvaltning.
The strategy used by the fund has proved successful historically, particularly during periods of rising interest rates. “This is the reason why we have chosen to launch this fund as our first smart beta ETF,” says Pär Nürnberg.