HSBC Asset Management (AM) has launched the HSBC S&P 500 Equal Weight Equity Index Fund.

This is the first UK-domiciled index fund to track the S&P 500 Equal Weight Thermal Coal Screened Index by investing in the underlying securities, physically replicating the benchmark.

HSBC AM stated that the fund offers investors diversification in their US equity exposure and mitigates concentration risks associated with US mega-cap stocks through incorporating the equal weight index methodology.

The HSBC S&P 500 Equal Weight Equity Index Fund is available to both wholesale and institutional investors.

It offers equally weighted exposure to the constituents of the index, while also applying exclusions in line with HSBC AM’s thermal coal policy.

HSBC AM said that the launch followed growing demand for the investment solution, with equal weight ETFs recording strong inflows in recent months.

Commenting on the launch, HSBC AM head of UK ETF & indexing sales, Bhavick Patel, said: “We are very pleased to offer investors the first unlisted UK-domiciled index fund (OEIC) tracking the S&P 500 Equal Weight Thermal Coal Screened Index providing large cap US equity exposure to investors in an equal weight format.

“Index concentration in US large cap equity benchmarks is top of mind for investors. The S&P 500 Equal Weight Equity Index Fund offers timely, diversified access to US equities at a moment when investors are looking for alternatives to market cap weighted benchmarks to mitigate this risk.”

HSBC AM’s index fund assets have more than doubled from $27bn at the end of 2019 to over $63bn as of the end of March 2024, with UK-domiciled assets also increasing more than two-fold to pass $43bn over the same period.

---