Originally published at: https://blog.investengine.com/3392-2/
If you’re looking for a simple, low-cost way to invest across global markets, the MSCI World Index could be a great place to start. It’s one of the most popular choices for long-term investors who want diversification without the complexity.
In this guide, we’ll explain what the MSCI World Index is, why it’s popular, and how you can invest in it from the UK using a low-cost ETF.
What is the MSCI World Index?
The MSCI World Index tracks the performance of over 1,500 large and mid-sized companies across 23 developed markets. These include the US, UK, Japan, Germany, France, Canada, Australia and more.
You’ll find global brands like:
- Apple and Microsoft in the US
- Nestlé in Switzerland
- Toyota in Japan
- Shell and AstraZeneca in the UK
The index spans a wide range of sectors, from tech and healthcare to finance. It’s reviewed quarterly to reflect market changes and company performance.
Why invest in the MSCI World?
The MSCI World offers:
- Instant global diversification – reducing reliance on any single country or industry
- Exposure to developed economies – covering roughly 85% of the developed world’s stock market capitalisation
- A simple, low-cost way to invest passively – ideal for investors who want a hands-off strategy
For UK investors, MSCI World ETFs can be a popular “core” holding, forming the foundation of a globally diversified portfolio.
How to invest in the MSCI World from the UK
1. Choose an MSCI World ETF
You can’t invest directly in the MSCI World index. But you can invest in an Exchange-Traded Fund (ETF) that tracks it.
Some popular MSCI World ETFs available on InvestEngine include:
Each fund may differ slightly in terms of:
- Total expense ratio (TER): typically 0.12% to 0.20%
- Accumulating vs distributing units (reinvesting dividends or paying them out)
- Domicile and currency exposure
All of these ETFs are available on the InvestEngine platform — with no trading or platform fees for DIY investors (ETF charges apply).
2. Choose your investment account
Choosing your account type is an important decision for anyone looking to invest. Depending on your goals, you can hold your ETF in:
- A Stocks and Shares ISA – Invest up to £20,000 per tax year with no tax on gains or income.
- A SIPP (Self-Invested Personal Pension) – Get tax relief on contributions up to £60,000 a year, and grow your pot tax-free until retirement.
- A GIA (General Investment Account) – Flexible, with no limits, though gains and dividends may be taxed above your allowances. Ideal for anyone who has maxed out their ISA allowance already.
Want to invest through your company? Our Business Account also supports MSCI World ETFs.
We compare ISAs and SIPPs in this article. They do different things but, for a lot of investors, one or both will be sufficient.
Choosing the right account can make a big difference to your long-term returns, so it’s worth thinking about how each one aligns with your financial goals.
3. Decide how and when to invest
How you invest is up to you and will depend on your goals and your financial situation. You can:
- Invest a lump sum – useful if you’ve saved up or received a windfall.
- Set up regular contributions using an InvestEngine Savings Plan
Watch our video explainer to learn more about how investing regularly compares to investing a lump sum.
Savings Plans automate weekly, fortnightly or monthly payments from as little as £20. So, you can set up your regular investments then sit back and relax as your portfolio ticks over.
What to consider before investing
Currency exposure
MSCI World ETFs are typically priced in USD – though some are priced in other currencies like GBP. If priced in dollars, it means your investment is affected by fluctuations in the GBP/USD exchange rate — although this also adds diversification.
US concentration
While the index covers multiple regions, it’s heavily weighted toward the US (typically 60–70%). That’s not necessarily a bad thing, but some investors may want to combine it with emerging market or UK-focused ETFs for broader balance.
Long-term horizon
As with any broad index tracker, The MSCI World is best suited to those targeting steady growth, not quick gains. It’s a fit for investors with a long time horizon who want low-maintenance exposure to global markets.
Why use InvestEngine to invest in the MSCI World?
At InvestEngine, we make it easy to build a globally diversified portfolio with the MSCI World as a core holding.
Here’s what you get:
- Commission-free investing – No trading or platform fees for DIY portfolios (ETF costs apply)
- Wide ETF choice – Including a range of MSCI World ETFs and other popular indices
- Flexible accounts – ISA, SIPP, GIA, or Business Accounts for all your investing needs
- Regular investing tools – Set up automated contributions with Savings Plans
Whether you’re just starting out or fine-tuning a long-term strategy, we give you the tools to invest simply and with confidence.
Final thoughts
The MSCI World index offers a straightforward, low-cost way to invest across developed markets — from the US and UK to Japan and Europe.
With one ETF, you can gain exposure to thousands of global companies, reduce country-specific risk, and build a strong foundation for your future wealth.
Just remember: while the MSCI World covers a lot, it’s still worth thinking about how it fits into your wider portfolio. You might want to complement it with emerging markets, UK equity, or thematic ETFs depending on your goals.
Important information
Capital at risk. The value of your investments may go down as well as up, and you may get back less than you invest.
Tax treatment depends on your personal circumstances and may change in future. This article is for general information only and does not constitute financial advice.