New Milestone for Largest S&P 500 ESG ETF

    Stockholm (NordSIP) – On September 7, UBS Asset Management announced that the UBS ETF S&P 500 ESG UCITS ETF, the first exchange-traded fund to integrate a socially responsible investing filter to the S&P 500 equity index has reached the US$1 billion AUM mark, which makes it the largest ETF tracking the ESG version of the renowned US large-cap index.

    This ETF applies a ‘light green’ ESG screen and excludes around 25% of the market cap of the parent index based on various ESG criteria.

    Since inception in March 2019, the ESG version of the fund has outperformed the standard S&P 500 index by more than 550 basis points. “Attribution results indicate that this outperformance is well diversified across sectors and primarily stems from the selection of higher ESG-rated companies,” UBS ETF state in a press release. “For a portfolio with an active share of 25%, covering broad US equities, it is a very solid investment outcome, highlighting the potential benefits of ESG investing.” As illustrated in the graph below, the outperformance also seems to have been relatively stable over time.

    “We are pleased to see investors quickly adopting the S&P 500 ESG index as the leading independent ESG benchmark for US equity. The strong demand for ESG index-based portfolios underscores our belief that investors will continue to integrate ESG values into the core of their investments,” says Reid Steadman, Global Head of ESG Indices at S&P Dow Jones Indices.

    Florian Cisana, Head of ETF & Passive Sales Strategic Markets EMEA, UBS ETF

    “Over the last 10 years we’ve built a sustainable ETF product shelf tailored to meeting investors’ different needs. Our funds provide a range of ‘shades of green,’ offering clients the opportunity to select the best solutions for their portfolios. As investor demand for sustainable products continues to grow, the S&P 500 ESG ETF will remain an excellent option for those seeking an ESG solution for accessing this key US Equities portfolio building block,” says Florian Cisana, Head of ETF & Passive Sales Strategic Markets EMEA at UBS Asset Management (pictured right).

    Photo credits: sitthiphong on Twenty20

    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA is Editor-in-Chief for NordSIP and Managing Director for Big Green Tree Media. She has 18 years of experience in the asset management industry in Stockholm, London and Geneva, including as a long/short equity hedge fund portfolio manager, and buy-side analyst, but also as CFO and COO in several asset management firms. Aline holds an MBA from Harvard Business School and a License in Economic Sciences from the University of Geneva.

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