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The fund, which has been listed on the NYSE Euronext in Paris, is linked to the Russell 2000 Index, a leading market capitalization-weighted index of US small capitalisation companies.
A subset of the broader Russell 3000, the Russell 2000 index comprises 2000 stocks constituting the smallest 10% of stocks in the US market by market capitalisation. By including only small cap companies, the index channels exposure towards the US domestic economy.
The average market capitalization of companies in the index is around $1.79 billion; the median market cap is around $720 million. The market cap of the largest company in the index is around $5.27 billion. By contrast, the average market capitalization of constituents in the large cap Russell 1000 index is $109 billion, with the median market cap at $7.52 billion (as of December 31, 2013).
The index is diversified across sectors, the largest of which are Financial Services, Consumer Discretionary, Technology, Producer Durables and Health Care. The largest individual constituents are CoStar Group, Athenahealth, Acuity Brands, Middleby Corp and Isis Pharmaceuticals (as of December 31, 2013).
The fund will appeal to investors positive on the outlook for the US economy, as well as those looking to increase portfolio diversification and potentially enhance returns. Indeed, the potential long-term benefits of including small cap stocks as part of a diversified, multi-asset portfolio have been well documented by numerous academic researchers and industry practitioners. A wide body of research has shown that small cap stocks have distinct risk/return characteristics that can increase portfolio diversification and boost potential returns over time.
Valérie Baudson, Global Head of ETF and Indexing at Amundi, commented: “This new ETF is another example of our commitment to launch competitively-priced products and offers a new allocation brick for US equities.”
The ETF has a total expense ratio (TER) of 0.35%, the lowest in the European market, and is available in both EUR and USD share classes.
Amundi is a subsidiary jointly created by Crédit Agricole (80% owenership) and Société Générale (20%) in 2010 to regroup their asset management activities. The company has more than €750 billion in assets under management.