HSBC MSCI World Islamic ESG UCITS ETF (Acc)

Issuer: HSBC

Asset Class: Equity

TER: 30bps

Trading Currency: USD

Pays Income: False

Listing Date: 01 Dec 2022

Ticker: HIWO

ISIN: IE000X9FTI22

This investment offers exposure to a diversified portfolio of large and mid-capitalisation companies across developed markets, specifically designed to adhere to Islamic investment principles. The strategy involves tracking a benchmark index that screens a global universe of equities to ensure compliance with Shariah law. This process systematically excludes businesses involved in prohibited activities such as alcohol, tobacco, gambling, conventional financial services involving interest (riba), and pork-related products. In addition to the faith-based screening, the underlying index also incorporates Environmental, Social, and Governance (ESG) criteria, filtering out companies with poor ESG profiles. This results in a portfolio that is not only Shariah-compliant but also aligns with broader sustainable and ethical investing values.

The fund presents a compelling option for investors seeking to build a portfolio that reflects their personal values and faith without sacrificing global diversification. By focusing on Shariah-compliant sectors like information technology, healthcare, consumer discretionary, and industrials, it provides access to key growth areas of the global economy. The dual-layer screening process, combining both Islamic principles and ESG considerations, may appeal to a wide range of socially conscious investors. As an accumulating vehicle, all income and dividends generated by the underlying holdings are automatically reinvested back into the fund, which can help compound returns over the long term and simplify portfolio management for those focused on capital appreciation.

Within a broader investment strategy, this product can serve as a core component for a Shariah-compliant global equity allocation. Its focus on established companies in developed economies offers a stable foundation for long-term growth. For conventional investors, it could act as a satellite holding to introduce an ethical or faith-based dimension to their existing portfolio. The investment provides a convenient and cost-effective single-product solution for gaining exposure to a carefully curated basket of global stocks that meet stringent ethical and religious criteria, making it a versatile tool for various portfolio construction needs.