UBS ETF Factor MSCI EMU Quality UCITS ETF

Issuer: UBS

Asset Class: Equity

TER: 25bps

Trading Currency: GBX

Pays Income: False

Listing Date: 23 Sep 2015

Ticker: UD04

ISIN: LU1215451524

This investment vehicle offers targeted exposure to high-quality companies within the European Monetary Union (EMU) equity market, combined with a robust socially responsible screening process. The strategy is designed to identify firms that exhibit strong and sustainable business characteristics, typically defined by high return on equity, stable year-over-year earnings growth, and low financial leverage. By focusing on these 'quality' metrics, the portfolio aims to capture a well-documented factor premium that has historically been associated with enhanced risk-adjusted returns over the long term. This approach seeks to provide a degree of resilience during periods of market volatility, as financially sound companies are often better equipped to navigate economic downturns.

In addition to the quality factor tilt, the fund incorporates a significant Socially Responsible Investing (SRI) overlay. It systematically excludes companies with significant business involvement in controversial sectors such as tobacco, controversial weapons, thermal coal, and oil sands, as well as those failing to comply with United Nations Global Compact principles. This dual-screening methodology results in a portfolio that not only focuses on financially robust enterprises but also aligns with the principles of sustainable and ethical investing. It is therefore well-suited for investors seeking a core European equity holding that combines the potential for long-term capital appreciation with a commitment to environmental, social, and governance (ESG) standards, providing a refined and values-based exposure to the Eurozone.