UBS ETF (IE) S&P 500 ESG Elite UCITS ETF (Hedged to GBP) A-dis

Issuer: UBS

Asset Class: Equity

TER: 18bps

Trading Currency: GBX

Pays Income: False

Listing Date: 12 Mar 2021

Ticker: S5EG

ISIN: IE00BLSN7X94

This investment vehicle offers a targeted approach to sustainable investing within the core of the US equity market. It is designed for those who wish to align their capital with stringent environmental, social, and governance (ESG) principles without sacrificing exposure to the large-cap US stock universe. The strategy tracks an "ESG Elite" index, which applies a more rigorous set of sustainability criteria than standard ESG benchmarks. The index begins with the parent S&P 500 and then systematically excludes companies involved in controversial activities such as tobacco, controversial weapons, thermal coal, and oil sands. Furthermore, it removes companies that are non-compliant with the UN Global Compact principles and those with lower S&P DJI ESG scores, ultimately aiming to include only the top 25% of companies with the highest ESG scores in each industry group.

By focusing on these ESG leaders, the fund provides a portfolio of companies that are potentially better positioned to navigate long-term sustainability challenges and opportunities. This can appeal to investors looking to mitigate risks associated with poor environmental practices, social controversies, or weak corporate governance. The physical replication model adds a layer of transparency, as the fund directly holds the shares of the companies in the index. This particular share class is also currency-hedged, which is a significant feature for investors whose home currency is not the US dollar. This hedging strategy aims to minimize the impact of currency fluctuations on returns, thereby offering a more direct reflection of the performance of the underlying ESG-screened US equities. It serves well as a core holding for a sustainably-focused portfolio.