SSGA slashes fee on emerging markets equity ETF

Nov 30th, 2022 | By | Category: Equities

State Street Global Advisors (SSGA) has announced an expense ratio reduction for the $320 million SPDR MSCI Emerging Markets UCITS ETF from 0.42% to 0.18%, effective 5 December.

SSGA slashes fee on emerging markets equity ETF

SSGA will more than halve the fee charged on its emerging markets equity ETF.

The fee cut represents an annual saving of approximately $770,000 for current investors in the fund.

The ETF is linked to the MSCI Emerging Markets Index which captures large and mid-cap equity performance across 24 developing countries.

With 1,386 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

Emerging market equities have slumped in 2022 due to the combined effects of rapidly rising interest rates, a strong US dollar, and concerns surrounding global economic growth – the MSCI Emerging Markets Index is down 20.7% year-to-date (as of 29 November).

The SPDR MSCI Emerging Markets UCITS ETF is listed on London Stock Exchange in US dollars (EMRD LN) as well as on Deutsche Börse Xetra (SPYM GY), Borsa Italiana (EMRG IM), and Euronext Paris (EMRG FP) in euros.

The fund’s lower fee matches that of the $14.3bn iShares Core MSCI Emerging Markets IMI UCITS ETF (EIMU LN), the largest emerging markets ETF available in Europe.

Investors can, however, gain even lower cost exposure to emerging markets through the Amundi Prime Emerging Markets UCITS ETF (PRAM LN) which is priced at just 0.10%. PRAM, which tracks the Solactive GBS Emerging Markets Large & Mid Cap Index, has yet to gain significant assets under management.

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