Key Morningstar Metrics for UBS MSCI United Kingdom IMI Socially Responsible UCITS ETF UKSR
- : NeutralMorningstar Medalist Rating
- : AverageProcess Pillar
- : Above AveragePeople Pillar
- : AverageParent Pillar
The UBS MSCI UK IMI SRI ETF provides investors with a practical way to access UK equities while emphasizing environmental, social, and governance principles, including a focus on reducing carbon emissions. However, the relatively strong ESG credentials also result in significant bets against the broader market, which reduces our confidence in the merits of the strategy and underpins a Process Pillar rating of Average.
The fund tracks the MSCI UK IMI Extended SRI Low Carbon Select 5% Issuer Capped Index, an ESG-focused index of approximately 150 companies derived from the broader MSCI UK IMI Index.
The index represents companies with low carbon exposure and high ESG scores within their sectors, as assessed by MSCI ESG Research, and excludes or underweights companies with high carbon emissions. Further, it excludes controversial industries such as weapons, tobacco, alcohol, or gambling. Finally, it excludes companies involved in thermal coal distribution or generating a significant portion of their revenue from oil or gas activities. This disciplined ESG approach is reflected in the fund’s 5-globe Morningstar ESG Risk Rating.
The fund’s ESG focus shapes its risk and return profile, resulting in greater volatility compared with broader market indexes. Its historical performance has experienced both highs and lows. In 2019–20, it ranked in the top quartile, but in 2022, it fell to the lower end of its peer group, reflecting a challenging market environment and its underweight exposure to the surging energy sector. The fund’s annual performance rebounded in 2024; however, more recently, it has again fallen below the median of its peer group.
UBS Asset Management has built a strong reputation in passive investing. The team’s extensive experience, proven stability, and disciplined, globally consistent investment strategy make it a strong choice for investors. The fund is among the cheapest ESG propositions in the category, making it an appealing option for investors seeking global equity exposure with a strong ESG focus.
UBS MSCI United Kingdom IMI Socially Responsible UCITS ETF: Performance Highlights
The ESG screening of the benchmark index produces a sector mix that differs markedly from the broader market, with a notable overweighting in financials and an underweighting in energy. Although the index’s overall market exposure (beta) remains close to one, its performance can deviate significantly from the market when these sectors outperform or lag.
The fund’s performance has been notably volatile in recent years. In 2024, it ranked in the top performance quartile of its category for the first time since 2020; however, in 2025, it had fallen below the category median. This pattern continued into 2026, with the fund ranking in the bottom decile in the first quarter before moving to the top decile in the second quarter. Over longer time horizons, the fund has underperformed broad passive benchmarks, its relatively concentrated and volatile portfolio contributing to a materially lower long-term Sharpe ratio.
While the ESG focus offers potential benefits such as sustainability and some downside protection, the strategy has struggled to deliver consistent long-term outperformance. Investors should balance these performance considerations against their desire for ESG alignment when deciding on the fund’s role in a portfolio.
