The New York-based exchange-traded fund and exchange-traded product sponsor has listed the new fund on the London Stock Exchange.

US-based WisdomTree has launched its first exchange-traded fund dedicated to the UK market.

The WisdomTree UK Equity Income UCITS ETF, now listed on the London Stock Exchange, will invest in a diversified basket of over 100 of the UK’s highest dividend yielding stocks in the index, which is weighted by yield. 

The index, which WisdomTree said offers the potential for better risk-adjusted performance relative to traditional UK market cap-weighted benchmarks, follows a methodology that the company has been running for over nine years in the US.

“The WisdomTree UK Equity Income UCITS ETF provides for greater diversification than is typical in other UK income strategies. It...features a large cap bias with over 83 per cent of the index comprised of stocks with market capitalisation greater than £10 billion and close to 15 per cent in mid-cap stocks,” said Viktor Nossek, director of research at WisdomTree Europe.

“The capping of individual sector exposures at 25 per cent creates a more balanced portfolio construction compared to other unconstrained strategies, providing risk control at different parts of the investment cycle.”

The ETF has a dividend yield of 5.9 per cent at launch and a total expense ratio of 29 basis points. WisdomTree currently has around $53.9 billion in assets under management globally.