London
iShares rolls out thematic beta ETF offering
iShares is hitting the alternative beta ground hard and fast, rolling out a constellation of new thematic and specialist sector funds.
- iShares Thomson Reuters Inclusion and Diversity UCITS ETF (OPEN)
- iShares Global Brands UCITS ETF (LOGO,LABL)
- iShares S&P US Oil & Gas Equipment UCITS ETF (DRIL, DRLS)
- iShares S&P US Banks UCITS ETF (BNKS)
In keeping with the ESG zeitgeist, OPEN will track companies that are weighted by how inclusive they are of women and how diverse they are. It will do so curiously by a Thomson Reuters index (this is the first ETF we are aware of that tracks and Reuters index) about which more detail can be found here.
LOGO will build on a theme that has been used before by US issuers and pick companies based on how strong their brad is. (This, it might be argued, is a value ETF in disguise, where brand is a substitute for franchise value). LOGO will track the Nasdaq Interbrand Best Global Brands Index and charge 40 basis points.
BNKS will offer exposure to US regional banks as well as diversified banks. It will do this via the S&P 900 Banks (Industry) 7/4 Capped Index, which caps the weights of the biggest five banks at 7% and the rest at 4%. (Index handbook here).
DRIL will track the S&P Oil & Gas Equipment Select Industry Index, which is the same index tracked by State Street's XES (hilarious ticker, I don't think they noticed), which has $7bn under management.
iShares is also cross-listing two of its existing ETFs into London. They are:
- iShares Dow Jones U.S. Aerospace & Defense UCITS ETF (AER0)
- iShares U.S. Preferred Stock UCITS ETF USD (PREF)
PREF tracks preferred stock – called hybrids elsewhere – which saddle the grey line between equity and debts. PREF will track the S&P U.S. Preferred Stock 4.5% Capped Monthly Index and charge 47 bps.
AER0 targets the defence and aerospace industries.
