New Listing

State Street launches smart beta global value ETF

Follows the launch of a global low volatility ETF on 24 August

Tom Eckett

a man wearing glasses

State Street Global Advisors (SSGA) has expanded its smart beta range with the launch of a global value ETF.

The SPDR MSCI World Value UCITS ETF (WVAL) is listed in euros on Euronext Amsterdam and in US dollars and sterling on the London Stock Exchange on 4 September with a total expense ratio (TER) of 0.25%.

Tracking the MSCI World Value Exposure Select index, WVAL offers exposure to large and mid-cap securities across 23 countries.

The index tracks the top 350 securities of the MSCI World based on their highest combined value select score, which includes companies that show strong higher value characteristics versus the parent index.

In order to avoid ‘value traps’, the index incorporates both quality and value metrics.

Rebalanced semi-annually, each company has a maximum weighting of 5% with a 50% turnover buffer.

Matteo Andreetto (pictured), head of SPDR ETF business, EMEA, at SSGA, commented: “Investors using value strategies to take advantage of cheap stocks need to protect their portfolios against stocks that are ‘cheap for a reason’.”

How risky are value stocks?

Ryan Reardon, ETF strategist, SPDR, at SSGA, added: “Against a COVID-19 backdrop, investors are looking for geographical diversification in select value strategies.

“Currently, value looks cheap based on valuation spreads, and value stocks often perform well in the recovery phase following a recession. Given uncertainty around the shape and timing of the recovery, value investing offers a relatively attractive complement to a well-diversified portfolio.”

This is the second smart beta ETF SSGA has launched in the past two weeks after the firm unveiled a global low volatility strategy, the SPDR STOXX Global Low Volatility UCITS ETF (GLOW), on 24 August.

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