First Trust Launches Equal-Weight ETF Adaptation of the Dow

First Trust Advisors has come out with an exchange traded fund that equally weights components found in the widely observed Dow Jones Industrial Average.

On Wednesday, First Trust rolled out the First Trust Dow 30 Equal Weight ETF (NYSEArca: EDOW). EDOW has a 0.50% expense ratio.

The Dow 30 Equal Weight ETF tries to reflect the performance of the Dow Jones Industrial Average Equal Weight Index, which will equally weight a portfolio of 30 securities that comprise the benchmark Dow Jones Industrial Average, or the Dow. The equal-weight indexing methodology would allow each company stock to equally contribute regardless of their price, which many believe could significantly diminish stock specific risk relative to price weighting.