Inside the Gerd Kommer ETF: Holdings, Countries, and Sector Breakdown

6 min read

Gerd Kommer is arguably the most influential voice in passive investing across the German-speaking world. His books — particularly “Souveran investieren mit Indexfonds und ETFs” — have shaped how an entire generation of German retail investors thinks about portfolio construction. In 2023, his investment philosophy became directly investable with the launch of the L&G Gerd Kommer Multifactor Equity UCITS ETF, available in two share classes: accumulating (WELT0A, ISIN: IE0001UQQ933) and distributing (WELT0B, ISIN: IE000FPWSL69).

But what exactly is inside this ETF, and how does it differ from a standard world index fund? Let us look at the holdings, geographic allocation, and sector breakdown in detail.

What Makes the Gerd Kommer ETF Different?

Most global equity ETFs — like MSCI World trackers or FTSE All-World funds — use pure market capitalization weighting. This means the largest companies by market value get the highest allocation. The result: US stocks make up 60%+ of the portfolio, and the top 10 holdings (mostly US tech giants) account for roughly 20% of the fund.

Gerd Kommer has long argued that this approach has structural weaknesses. His ETF addresses them with a multi-factor methodology:

GDP Weighting Mixed with Market Cap

Instead of weighting countries purely by stock market size, the Gerd Kommer ETF blends market capitalization with GDP (gross domestic product). This reduces the dominance of the US — whose stock market is disproportionately large relative to its economy — and increases the weight of countries like China, Germany, and Japan, whose stock markets are smaller relative to their economic output.

The result is a more balanced geographic distribution than you would find in a pure market-cap index.

Multi-Factor Tilts

The ETF incorporates factor premiums that academic research has identified as sources of long-term excess returns:

  • Size: A tilt toward smaller companies, which have historically delivered higher returns than large caps over long periods.
  • Value: Overweighting stocks that trade at lower valuations relative to their fundamentals (book value, earnings, cash flow).
  • Quality: Favoring companies with strong profitability metrics and stable earnings.
  • Momentum: Giving additional weight to stocks with positive recent price trends.

These factor tilts are not dramatic — the ETF is still a broadly diversified global equity fund — but they systematically shift the portfolio away from a pure market-cap approach toward one that captures these documented premiums.

Emerging Markets Inclusion

Like the FTSE All-World index, the Gerd Kommer ETF includes emerging markets. However, the GDP weighting component means emerging markets get a somewhat higher allocation than they would in a pure market-cap index, since countries like China and India have large economies relative to their stock market capitalizations.

The Holdings: Over 4,000 Stocks

The Gerd Kommer ETF holds approximately 4,000 individual stocks — a level of diversification comparable to the broadest world indices. This is not a concentrated fund picking specific winners. It is a systematic, rules-based portfolio that spans nearly the entire investable global equity universe.

Top Holdings

Because of the GDP weighting and factor tilts, the top holdings list looks different from a standard MSCI World ETF. While familiar names like Apple, Microsoft, and NVIDIA still appear, their individual weights are lower. You will not see a single stock occupying 4-5% of the fund the way Apple might in a pure market-cap tracker.

This lower concentration at the top is a deliberate design choice. Gerd Kommer has argued that having 20% of your portfolio in just 10 stocks undermines the diversification benefit that index investing is supposed to provide.

Country Allocation: A More Balanced World

This is where the Gerd Kommer ETF diverges most visibly from standard global ETFs.

Approximate Geographic Distribution

  • United States: ~45-50% (vs. ~60-63% in MSCI World or FTSE All-World)
  • Japan: ~7-8%
  • China: ~5-6%
  • United Kingdom: ~4%
  • India: ~3-4%
  • Germany: ~3%
  • France: ~3%
  • Canada: ~2.5%
  • South Korea: ~2%
  • Taiwan: ~2%
  • Remaining countries: ~18-20%

The US allocation of roughly 45-50% is meaningfully lower than the 60%+ in market-cap-weighted alternatives. For investors who have been concerned about US concentration but still want broad global exposure, this is one of the key attractions of the Gerd Kommer approach.

Emerging markets collectively receive a higher allocation — roughly 20-25% compared to 10-12% in FTSE All-World — reflecting the GDP weighting methodology.

Sector Breakdown

The sector distribution is influenced by both the geographic rebalancing and the factor tilts. Because the fund underweights the US relative to market cap, and US-listed tech companies are the largest in the world, the technology sector weighting is naturally lower.

Approximate Sector Allocation

  • Technology: ~18-20% (vs. ~24-26% in market-cap-weighted funds)
  • Financials: ~17-18%
  • Industrials: ~12-13%
  • Consumer Discretionary: ~10-11%
  • Healthcare: ~9-10%
  • Consumer Staples: ~6-7%
  • Materials: ~5-6%
  • Energy: ~5%
  • Communication Services: ~5%
  • Utilities: ~3-4%
  • Real Estate: ~2-3%

The lower tech weighting and higher financials/industrials allocation reflect the combined effect of GDP weighting (which reduces US dominance) and the value/quality factor tilts (which favor profitable, reasonably valued companies across all sectors).

WELT0A vs. WELT0B: Accumulating or Distributing?

Like many European ETFs, the Gerd Kommer ETF is available in two share classes:

  • WELT0A (Accumulating): Dividends are reinvested. Generally preferred by investors in countries where accumulating funds are more tax-efficient (including Germany, under certain conditions).
  • WELT0B (Distributing): Dividends are paid out. Preferred by investors who want regular income or whose tax situation makes it equivalent.

Both hold identical portfolios. The choice between them is purely a tax and cash flow decision.

Why Understanding Holdings Matters

Even with a rules-based, broadly diversified ETF, knowing what is inside your investment serves several purposes:

Avoiding unintentional overlap. If you hold the Gerd Kommer ETF alongside other funds, you need to understand the overlap. Adding a separate emerging markets ETF on top might make sense for a market-cap-weighted world fund, but could lead to double-counting with the Gerd Kommer ETF’s already higher EM allocation.

Evaluating the factor tilts in practice. The multi-factor approach sounds compelling in theory, but seeing the actual portfolio — which stocks are overweighted, which are underweighted — makes the concept concrete. Are the value and size tilts visible in the holdings? Is the reduced US concentration reflected in the data? These are questions you can only answer by looking at the actual positions.

Setting realistic expectations. When the Gerd Kommer ETF underperforms a pure MSCI World tracker (which it will during US tech-led rallies), understanding the structural differences helps you stay the course. The underperformance is not a flaw — it is a direct consequence of the deliberate diversification choices.

Analyzing the Gerd Kommer ETF in Practice

Factsheets provide quarterly snapshots, but they are static, delayed, and limited in granularity. If you want to explore the actual 4,000+ holdings — filter by country, examine sector weights, see historical price performance in your preferred currency — you need a more interactive tool.

Gerd Kommer Tracker lets you do exactly this. It provides the full holdings breakdown with the ability to explore positions by country, region, and sector. You can view historical prices in 10 currencies, access comprehensive statistics including CAGR, volatility, and streak analysis, and export data for use in other portfolio tools.

The app is available on iPhone and Mac, giving you immediate access to the complete ETF composition whenever you need to check a holding, verify your portfolio overlap, or simply understand what your investment looks like under the hood.

Passive investing works best when the investor is informed. Understanding what the Gerd Kommer ETF holds — and why it holds it differently from standard index funds — is the foundation for staying committed to the strategy through all market conditions.