Wealth Manager - Essential news for investment professionals

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

iShares targets minimum volatility with new ETF range

iShares targets minimum volatility with new ETF range

iShares, the exchange traded fund (ETF) arm of BlackRock, has launched a raft of ETFs designed to deliver returns with the lowest absolute volatility.

The new range, launched on the London Stock Exchange, comprises the iShares MSCI World Minimum Volatility, MSCI Emerging Markets Minimum Volatility, Europe Minimum Volatility and S&P 500 Minimum Volatility.

The physically-replicated funds, which use an optimisation process to enhance liquidity, track their respective benchmarks which are based on a minimum volatility strategy.

This selects securities from a parent index, based on estimates of the risk profile and expected volatility of each constituent, as well as the correlation between the constituents.

The aim of the strategy is to select the stocks with the lowest absolute volatility of returns, subject to certain risk diversification constraints, minimum and maximum weightings, sectors and country weights.

The ETFs, which have total expense ratios of 0.20% to 0.40%, have not yet gained reporting status in the UK, although they are in the process of seeking it.

The launch marks the ETF provider’s expansion into the ‘Smart Beta’ space in the UK, with a set of products providing enhanced equity exposure.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Tesco, Japan and the rise of the central banker

Tesco, Japan and the rise of the central banker

 Libby Ashby and leading wealth managers scrutinise the food retail sector, Japan’s consumption tax hike and political risk in the markets.

Play Colin McLean's mid-cap picks

Colin McLean's mid-cap picks

The SVM director and fund manager on his pick of the UK mid-caps.

Play Gervais Williams: the real reason to worry about Quindell

Gervais Williams: the real reason to worry about Quindell

Citywire AA-rated manager Gervais Williams has argued that sentiment is the true danger to Quindell.

Your Business: Cover Star Club

Profile: Psigma's Edinburgh boss on why he is in Scotland long term

Profile: Psigma's Edinburgh boss on why he is in Scotland long term

When Tim Wishart agreed to launch an Edinburgh office for Psigma he was not expecting to  head the company’s first overseas team

Wealth Manager on Twitter