BlackRock has unveiled a new ETF in Europe, offering investors a focused strategy to target the largest companies listed in the United States.
The ETF offers focused exposure to the largest 20 companies in the S&P 500.
The iShares S&P 500 Top 20 UCITS ETF has been listed on the London Stock Exchange in GBP (Ticker: SP20 LN), Xetra in EUR (Ticker: IS20 GY), and Euronext Amsterdam in USD (Ticker: SP20 NA).
It tracks the S&P 500 Top 20 Select 35/20 Capped Index, which comprises the 20 largest companies in the S&P 500, selected and weighted by float-adjusted market capitalization at every quarterly review.
The index employs a capping methodology in which the largest constituent is weighted at its full market capitalization, while all other constituents are capped at a maximum of 18% of the index weight.
Stocks from the information technology sector dominate the index, accounting for nearly half (47.4%) of its weight, followed by Consumer Discretionary (14.2%), Communication Services (13.6%), and Financials (11.0%).
Major constituents include Apple (15.26%), Nvidia (15.17%), Microsoft (13.61%), Amazon (8.29%), Alphabet (8.3%), and Meta Platforms (5.3%).
The fund comes with an expense ratio of 0.20%.
BlackRock highlights the significant evolution of the US equity market, noting that the combined value of the eight largest US companies today equals the entire valuation of the US stock market in 2000—approximately $15 trillion.
Furthermore, the top 20 largest companies have contributed 68% of the S&P 500’s returns over the past three years, underscoring the outsized role of mega-cap stocks in driving market performance.
BlackRock emphasizes that the ETF provides an efficient solution for investors seeking concentrated exposure to the growth potential of the world’s most dominant companies, reflecting the increasing prominence of mega-cap stocks in shaping market outcomes.
Brett Pybus, Head of iShares EMEA Product Strategy at BlackRock, stated: “Now is the time for investors to rethink their market exposure. With this ETF, European investors can harness the power of growth and innovation within the largest US companies in a targeted way. The performance dispersion within the S&P 500 has created a need for precise exposure to US equities.”