L&G expands index range with the launch of S&P 500 Equal Weight Index Fund

Legal & General's Asset Management Division has today announced the launch of the Legal & General S&P 500 US Equal Weight Index Fund ("the Fund"), offering investors the opportunity to limit the risk of over-concentration to single stocks in the primary US index. The Fund will track the S&P 500 Equal Weight Index.

Targeting investors in UK wholesale markets, the Fund provides clients with equal weight exposure to issuers in the S&P 500. It will seek to mitigate risks among the handful of stocks that have dominated the weighting of the S&P 500 in recent years, through improved diversification.

The rise of the 'Magnificent seven' in the S&P 500 index referring to the seven largest companies in the US by market capitalisation, (namely Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla) has resulted in concentration being at its highest level in decades with these stocks comprising almost a third of the S&P 500¹. Such dominance has come at the expense of diversification, leading some investors to be over-exposed to volatility in the mega-cap tech sector.