Interactive Investor

ii ACE 40 investments:

UBS MSCI UK IMI SRI ETF


ii Ace 40
Asset GroupAsset Sub-GroupInvestment Category
EquitiesUK equitiesLow cost

Why we recommend it

Experienced investment manager: UBS is a leading provider of passive, index-tracking funds.

Low index-tracking error: This index-tracking exchange traded fund (ETF) has closely tracked the performance of its reference stock market index. This is the MSCI UK IMI Extended SRI Low Carbon Select 5% Issuer Capped Index, which captures large, mid and small-cap stocks of the UK equity markets. The index is designed to represent the performance of companies that have lower carbon exposure than that of the broad market and have high Environmental, Social and Governance (ESG) performance. Further, the index also aims to avoid concentration by capping issuers within the Index to a maximum weight of 5% in accordance with the MSCI Capped indexes methodology.

The fund is reasonably priced: The ‘A’ distributing share class levies annual ongoing charges of 0.28%.


Ethical criteria


ii ACE ethical style: Avoids. This means the ETF simply screens out specific sectors considered to be unethical, or stocks whose environmental, social and governance (ESG) scores are below a certain threshold.

Fund EcoMarket category: Sustainability Tilted. These funds integrate sustainability considerations into their investment process in order to help to make better investment decisions, but investments are not driven by sustainability themes. These funds may invest in most company types and may be ‘overweight’ in companies with higher standards and ‘underweight’ in companies with poor practices – rather than necessarily excluding them. They may work to encourage more sustainable business practices through stewardship activity.

How the fund is managed: The objective of the ETF is to replicate the price and return performance of the MSCI UK IMI Extended SRI Low Carbon Select 5% Issuer Capped Index of UK companies. The index focuses on ESG criteria and specifically excludes companies involved in nuclear power, tobacco, alcohol, gambling, military weapons, civilian firearms and genetically modified organisms. The index also includes aspect of lower carbon emission and climate change.

Please be aware that although all of these funds have ethical criteria their strategies vary. Some funds, particularly low cost and tracker funds, often invest in companies that are considered to be more responsibly managed than their competitors - but may still be considered undesirable by some ethically minded investors.


The risks


Ethical screening: In certain market conditions the performance of the fund may differ significantly from others in the peer group that do not exclude ethically screened sectors or companies from a comparable investment universe.


Information and data compiled to October 2021.


Risk warnings

The information we provide in the ACE 40 investments list does not constitute a "personal recommendation". You should ensure that any investment decisions you make are suitable for your personal circumstances and that the ethical style of the investment reflects your personal beliefs.

Past performance of the underlying constituents is not a guarantee of future performance. Remember, the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest.

Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab.

If you are unsure about the suitability of a particular investment or think that you need a personal recommendation, you should speak to a suitably qualified financial advisor.

Any changes to the ii ACE 40 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Outlook.

Details of all recommendations issued by ii during the previous 12 month period can be found here.

ii adheres to a strict code of conduct. Members of ii staff may hold shares in companies mentioned in the ii ACE 40 investments list, which could create a conflict of interest. Any member of staff intending to complete some research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.

In addition, staff involved in the production of this ii ACE 40 list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the list. This is to avoid personal interests conflicting with the interests of the recipients of this ii ACE 40 investments list.