The physically-backed exchange-traded fund gives investors access to the 100 least volatile stocks in the S&P 500.
Its aim is to provide simple and transparent investment in a diversified portfolio of US large cap stocks with historically lower volatility.
The fund is designed to complement SPDR’s existing US equity product range, which includes its flagship S&P 500 product that only launched in Europe back in March, its S&P 400 Mid Cap ETF and S&P US Dividend Aristocrats ETF.
The S&P 500 Low Volatility Index is rebalanced quarterly and includes 100 stocks from the S&P 500 which have had the lowest price volatility in the prior 252 trading days.
Stocks with the highest volatility are given the lowest weightings and those that have been the least volatile have higher weightings, with a 4% cap.
Scott Ebner, global head of product development at SPDR ETFs, said: “With the volatility in equity markets over the past couple of years, many clients are looking for ways to help reduce the potential drawdown impact of market retreats, while still participating in some of the upside of US equity investing.
“The SPDR S&P 500 Low Volatility ETF can be used in combination with other US equity exposures to adjust risks or as an alternative to traditional market capitalisation weighted index strategies.”
The fund is listed for sale in the UK, Ireland, Italy, France, the Netherlands and the UK.
