Innovative ETPs: Equalweight ETFs

Investors are discovering a new equity indexing strategy that some consider more rational than the traditional market cap weighting approach

Hortense Bioy, CFA 7 October, 2011 | 2:47PM
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This article is part of our series of regular pieces where we discuss recently issued exchange-traded products (ETPs) which are seen to be innovative or otherwise attempt to improve upon existing strategies available within an ETP wrapper. Our intention is to give the reader a better understanding of those products and highlight potential benefits and risks for investors. Last time, we examined Lyxor ETF’s EURO STOXX 50 BuyWrite.

In this article, we will analyse the first equal-weight ETFs to be introduced in Europe by Dutch provider ThinkCapital and French provider Ossiam.

Last April, ThinkCapital, a subsidiary of BinckBank, rolled out a Global Equity Tracker, which invests in 250 large cap stocks listed worldwide and a Global Real Estate Tracker, which invests in the shares of 25 real-estate firms across the globe.

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About Author

Hortense Bioy, CFA

Hortense Bioy, CFA  is global head of sustainability research at Morningstar