First Trust Advisors LP on Wednesday rolled out the First Trust Dow 30 Equal Weight ETF (EDOW), an index-tracking fund that equal weights the 30 components of the venerable Dow Jones Industrial Average, a domestic blue-chip roster of large-cap companies covering all industries except transportation and utilities. The Dow index is price-weighted.
According to First Trust, the aim of equal weighting the 30 companies in the Dow is to reduce stock specific risk relative to price weighting. EDOW will be rebalanced quarterly, which will maintain weightings of 3.33 percent for each constituent in the index.
The fund tracks the Dow Jones Industrial Average Equal Weight Index, which is part of the family of S&P Dow Jones Indices. Its expense ratio is 0.50 percent.