UBS ETF (IE) MSCI World Small Cap Socially Responsible UCITS ETF (USD) A-acc

Issuer: UBS

Asset Class: Equity

TER: 23bps

Trading Currency: GBX

Pays Income: False

Listing Date: 23 Aug 2021

Ticker: WSCR

ISIN: IE00BKSCBW67

This fund provides exposure to a diversified portfolio of small-capitalization companies from developed markets around the world. It is specifically designed for investors who want to align their portfolios with environmental, social, and governance (ESG) principles. The strategy involves tracking an index that screens for companies based on stringent socially responsible investing (SRI) criteria. This means it excludes businesses involved in controversial activities such as certain weapons, tobacco, and fossil fuels, while also considering their carbon footprint. The fund focuses on companies with high ESG ratings relative to their peers, offering a "best-in-class" approach to sustainable investing within the small-cap segment.

Investing in this fund offers a dual opportunity: capturing the growth potential inherent in smaller companies while adhering to sustainable values. Small-cap stocks historically have the potential for higher growth compared to their large-cap counterparts, as they are often more agile and operate in niche markets with significant expansion possibilities. By integrating an SRI and low-carbon screen, the portfolio aims to mitigate risks associated with poor corporate governance, environmental liabilities, and social controversies. This can lead to a more resilient portfolio in the long term, appealing to investors who believe that sustainable business practices are a key driver of financial outperformance and risk management.

This instrument can serve as a core component or a satellite holding within a diversified equity portfolio. For investors seeking to enhance their ESG exposure, it provides a targeted way to access the global small-cap market through a responsible lens. It can complement existing large-cap equity holdings by adding a different risk-return profile and diversification benefits. The fund is well-suited for long-term investors with a higher risk tolerance who are looking for capital appreciation and believe in the long-term viability of companies leading the way in sustainability. The distributing nature of the share class also provides a semi-annual income stream.