Insight

MSCI World exposure at the lowest cost on the market

9. April 2026
Chris Mellor
Chris Mellor
Head of EMEA ETF Equity Product Management
Close-up of a person’s eye reflecting an image of Earth in space.

Kurz zusammengefasst

1

Global equities have been the most in-demand ETF exposures in recent years.

2

The Invesco MSCI World UCITS ETF now has the lowest fee for this core exposure.

3

Our swap-based model can offer a structural advantage over physical ETFs.

Investment risks: For complete information on risks, refer to the legal documents. Investment risks include: Value Fluctuation, Use of Derivatives for Index Tracking, Synthetic Risk, Equity Risk and Currency Risk. Click here for more information.

ETFs that provide exposure to global equity markets have dominated flows in recent years. This trend is likely to continue as a growing range of investors use these core building blocks, particularly those providing cost-efficient exposure to key benchmarks. Invesco now offers the lowest annual charge of any ETF tracking the popular MSCI World Index along with the structural advantages of our swap-based replication model.

About the MSCI World index

The MSCI World Index is the most significant global equity benchmark in terms of assets following it, which includes 18 passively managed UCITS ETFs. It covers around 85% of the free float-adjusted market capitalisation in each of the 23 developed market countries and is currently comprised of over 1,300 large and medium-sized companies.  

What to consider in an ETF

Cost will almost always feature towards the top of an investor’s decision-making process, especially when selecting a passive exposure to what is likely to be a substantial portion of a portfolio. The ETF’s annual management fee is a sensible place to start and, all else being equal, you will want the lowest fee possible. The Invesco MSCI World UCITS ETF has the lowest annual management fee currently available for that exposure, at just 0.05% per annum. That’s 0.15% cheaper than the market average. 

Please note an investment in this fund is an acquisition of units in a passively managed, index-tracking fund rather than in the underlying assets owned by the fund. 

Cost is only one side of the coin, however. The product also needs to perform. For a passive ETF, performance can typically be measured by tracking error, i.e., how closely the ETF tracks the daily performance of the index over time, net of all costs. Here, performance can vary widely, and differences won’t always be due to fees alone.  

The structural advantage of swap-based replication

An ETF can track an index in one of two ways. The most common is to invest physically in all (or a sample of) the index constituents and rebalance the holdings whenever the index is rebalanced. Dividends from the stocks held would be received by the ETF net of tax, often at a reduced rate. The dividend withholding tax on US equities, for instance, is 0.30% for a US investor but only 0.15% for many European-domiciled ETFs.

The other way to replicate the index performance is for the ETF to hold a basket of stocks, but not necessarily the ones in the index, and use swaps to deliver the precise return of the index. This swap-based approach is sometimes referred to as synthetic replication and is intended to deliver more precise tracking, often at lower costs, than would usually be achievable through physical replication.

ETFs that use swaps achieve an even lower dividend withholding tax rate than physically replicated funds. For the MSCI World exposure, this structural advantage has equated to an average enhancement of 0.05% per annum since 2018 over physically replicated funds, before fees. The significant reduction in the annual fee should widen the overall performance gap between our ETF and those using physical replication. 

The swap-based advantage PLUS the cost benefit of lower fees

Find out more

Discrete performance

as of 31 March 2026

 

ETF

Index

Difference

Mar 2025 - Mar 2026

18.96%

18.90%

0.05%

Mar 2024 - Mar 2025

7.14%

7.07%

0.07%

Mar 2023 - Mar 2024

25.22%

25.07%

0.12%

Mar 2022 - Mar 2023

-6.87%

-7.02%

0.16%

Mar 2021 - Mar 2022

10.23%

10.12%

0.10%

Mar 2020 - Mar 2021

54.25%

54.03%

0.14%
Mar 2019 - Mar 2020 -10.21% -10.39% 0.20%
Mar 2018 - Mar 2019 4.21% 4.08% 0.12%

Mar 2017 - Mar 2018

 13.55% 13.52% 0.02%
Mar 2016 - Mar 2017 14.79% 14.77% 0.02%

Source: Bloomberg

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  • Investment risks

    For complete information on risks, refer to the legal documents.

    The value of investments, and any income from them, will fluctuate. This may partly be the result of changes in exchange rates. Investors may not get back the full amount invested.

    The Fund’s ability to track the benchmark’s performance is reliant on the counterparties to continuously deliver the performance of the benchmark in line with the swap agreements and would also be affected by any spread between the pricing of the swaps and the pricing of the benchmark. The insolvency of any institutions providing services such as safekeeping of assets or acting as counterparty to derivatives or other instruments, may expose the Fund to financial loss.

    The fund might purchase securities that are not contained in the reference index and will enter into swap agreements to exchange the performance of those securities for the performance of the reference index.

    The Fund is invested in a particular geographical region, which might result in greater fluctuations in the value of the Fund than for a fund with a broader geographical investment mandate.

    The value of equities and equity-related securities can be affected by a number of factors including the activities and results of the issuer and general and regional economic and market conditions. This may result in fluctuations in the value of the Fund.

    The Fund’s performance may be adversely affected by variations in the exchange rates between the base currency of the Fund and the currencies to which the Fund is exposed. 

    An investment in this fund is an acquisition of units in a passively managed, index-tracking fund rather than in the underlying assets owned by the fund. 

    Important information

    Data as at 30 March 2026, unless otherwise stated.

    This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

    Views and opinions are based on current market conditions and are subject to change.

    For information on our funds and the relevant risks, refer to the Key Information Documents/Key Investor Information Documents (local languages) and Prospectus (English), and the financial reports, available from: www.invesco.com/ie-manco/en/home.html. A summary of investor rights is available in English from www.invescomanagementcompany.ie. The management company may terminate marketing arrangements.

    UCITS ETF’s units / shares purchased on the secondary market cannot usually be sold directly back to UCITS ETF. Investors must buy and sell units / shares on a secondary market with the assistance of an intermediary (e.g. a stockbroker) and may incur fees for doing so. In addition, investors may pay more than the current net asset value when buying units / shares and may receive less than the current net asset value when selling them. For the full objectives and investment policy please consult the current prospectus or the Fund’s Supplement.

    Not all share classes of this fund may be available for public sale in all jurisdictions and not all share classes are the same nor do they necessarily suit every investor.

    Costs may increase or decrease as a result of currency and exchange rate fluctuations. Consult the legal documents for further information on costs.

    The funds or securities referred to herein are not sponsored, endorsed, or promoted by MSCI Inc. ("MSCI"), and MSCI bears no liability with respect to any such funds or securities or any index on which such funds or securities are based. The prospectus contains a more detailed description of the limited relationship MSCI has with Invesco and any related funds.

    EMEA5348065/2026