New Listing

UBS AM launches Swiss dividend ESG ETF

TER 0.20%

Theo Andrew

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UBS Asset Management has launched an ESG ETF tracking dividend-paying Swiss equities.

The UBS ETF MSCI Switzerland IMI Dividend ESG UCITS ETF (CHDIV) is listed on the Swiss Six Exchange with a total expense ratio (TER) of 0.20%.

CHDIV tracks the MSCI Switzerland IMI High Dividend Yield ESG Low Carbon Select index comprising of small, mid and large-cap stocks while applying a dividend yield and carbon exposure screens to the parent index.

Stocks involved in severe ESG controversies including controversial weapons, nuclear weapons, civilian firearms, tobacco, fossil fuel extraction and thermal coal power will be removed.

A series of dividend yield-related screens will then be applied including a dividend sustainability screening which excludes companies with an extremely high payout ratio.

Following this, the index will seek a minimum reduction in the weighted average carbon emission intensity of 30% relative to the parent index and will also apply several constraints such as sector weights and maximum constituent weights of 15%.

The ETF is labelled Article 8 under the Sustainable Finance Disclosure Regulation (SFDR).

Raimund Müller, head of ETF and index fund sales for Switzerland and Liechtenstein at UBS AM, said dividend yield has remained at a stable and attractive level over the past 10 years, playing a “substantial part of total equity returns”.

“Over the past 20 years, the Swiss Performance index has returned more than 300% when dividend payments are included versus approximately 130% when excluded,” he said.

“In other words, dividends represented more than half of total shareholder returns.”

Last month, the Swiss asset manager launched the UBS Carbon Compensated Gold ETF (GLDC02), listed on the Six Swiss Exchange with a total expense ratio (TER) of 0.30%.

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