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Legal & General Investment Management redefines core equity ETFs with the launch of new range
Legal & General Investment Management (LGIM) has launched a range of core low-cost equity exchange traded funds (ETFs) in response to feedback from clients that investors expect more from their core equity solutions.
13 Nov 2018
Low-cost core equity ETFs with key features that respond to the evolving investment landscape
- Avoids risk of crowding experienced by traditional core index ETF
- Raise the bar by investing in companies that meet minimum best business practices
- Actively engages with companies for strong governance to promote long-term performance
LGIM has redefined core equity market-cap ETFs through a new index design that can help shield investors from unpredictable behaviour of crowded trading that is experienced by equity indices commonly tracked by most core ETFs. LGIM’s new core equity range will ensure investors are not forced to turn over their portfolio at the same time as the vast majority of core equity ETFs in the market where short-term price volatility frequently occurs. The risk from this volatility is increasing with the rise of index investing, which LGIM believes highlights the need for change.
Howie Li, Head of ETFs at LGIM, said: "It’s right to expect more than just low-cost from core equity ETFs. Index managers need to be more active in mitigating the risks of crowded indices and engaging with companies for the long-term benefit of the market and investors. We have designed our range of core ETFs with these principles in mind, taking steps to promote long-term performance and stability."
LGIM’s core equity ETFs will also ensure companies in the portfolio meet minimum standards for best business practices in order to mitigate risks that may affect long-term investment performance. Unique to any core range on the market, LGIM’s Future World Protection List is integrated into the design, shielding investors from the negative future outlook associated with controversial weapons manufacturers, pure coal companies and consistent violators of the UN Global Compact. As part of LGIM’s management of over £984.8bn1 of assets, the core ETF range, as with all of LGIM’s funds, are subject to the active scrutiny of LGIM’s corporate governance team who engage with companies to create sustainable long-term value for investors.
LGIM has partnered with index provider Solactive, an established index provider with over a decade of operational track record and $200bn+2 invested into its indices, who will manage and calculate the indices designed and used by LGIM’s core equity ETFs.
Simon Hynes, Head of Retail Distribution, EMEA, said: "Our core equity ETFs can be used on their own or in conjunction with investors’ existing building blocks to help diversify issuer concentration risk. We believe our core range will be of interest to our clients due to the low cost and additional value they deliver compared to what’s currently available in the market."
The core equity ETF range is managed by LGIM’s ETF portfolio managers within the Global Index Fund Management team. The ETFs below are now listed on the London Stock Exchange.
L&G core equity ETF range of funds:
| Name | Share Class | Ticker | OCF* | Currency |
|---|---|---|---|---|
|
1 LGIM internal data as at 31 June 2018. These figures include assets managed by LGIMA, an SEC Registered Investment Advisor. Data includes derivative positions. 2 Source: Solactive as at January 2018 * Expressed as a % per annum of the Net Asset Value of the Share class. |
||||
|
L&G UK Equity UCITS ETF |
GBP Accumulating ETF |
LGUK |
0.05% |
GBP |
|
L&G Europe ex UK Equity UCITS ETF |
EUR Accumulating ETF |
LGEG |
0.10% |
GBP |
|
L&G US Equity UCITS ETF |
USD Accumulating ETF |
LGUG |
0.05% |
GBP |
|
L&G Global Equity UCITS ETF |
USD Distributing ETF |
LGGG |
0.10% |
GBP |
|
L&G Japan Equity UCITS ETF |
USD Accumulating ETF |
LGJP |
0.10% |
USD |
|
L&G Asia Pacific ex Japan Equity UCITS ETF |
USD Distributing ETF |
LGAG |
0.10% |
GBP |
Further information
Further information
Andrew Gates
Senior Communications Manager
Asset Management
T: +44 07702 118262
Notes to editors
LGIM is one of Europe’s largest asset managers and a major global investor, with total assets under management of £1.2 trillion1 ($1.5tn, €1.3tn, CHF 1.2tn). We work with a wide range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors.
For more than 50 years, we have built our business through understanding what matters most to our clients and transforming this insight into valuable, accessible investment products and solutions. We provide investment expertise across the full spectrum of asset classes including fixed income, equities, commercial property, and cash. Our capabilities range from index-tracking and active strategies to liquidity management and liability-based risk management solutions.
1Data as at 31 December 2023. Data combines assets under management by LGIM in the UK, LGIMA in the US and LGIM Asia in Hong Kong. Assets under management include securities and derivatives positions.