Xtrackers MSCI World Small Cap ESG Screened UCITS ETF 1C
| Issuer: Xtrackers |
| Asset Class: Equity |
| TER: 30bps |
| Trading Currency: USD |
| Pays Income: False |
| Listing Date: 05 Sep 2025 |
| Ticker: XZSW |
| ISIN: IE000UATQPE2 |
This financial product offers investors exposure to a globally diversified portfolio of small-capitalisation companies from developed markets that meet specific Environmental, Social, and Governance (ESG) criteria. By tracking its underlying benchmark, it aims to capture the long-term growth potential often associated with smaller companies while adhering to principles of responsible investing. Small-cap stocks can provide a different risk-return profile compared to their large-cap counterparts, potentially offering higher growth in exchange for greater volatility. This instrument is designed for those looking to combine the pursuit of capital appreciation from this dynamic market segment with an investment approach that reflects their personal values.
The investment strategy is built upon a robust screening methodology applied by the index provider. It systematically excludes companies with significant business involvement in controversial sectors such as thermal coal, oil sands, tobacco, and controversial weapons. Furthermore, the index removes companies that do not meet a minimum MSCI ESG rating, effectively filtering out firms with poor ESG practices. This rules-based approach ensures the resulting portfolio is composed of companies that demonstrate stronger management of ESG risks and opportunities, without sacrificing broad market diversification across numerous countries and industries.
Utilizing a physical replication strategy, the fund holds the actual stocks that constitute the index, providing direct exposure to the underlying assets. As an accumulating share class, any dividends paid out by the portfolio companies are automatically reinvested back into the fund. This process harnesses the power of compounding, which can significantly enhance total returns over the long term. This characteristic makes it a potentially suitable core holding for investors with a long-term horizon seeking to build wealth through a diversified, ESG-aligned global small-cap equity portfolio.
