August 9, 2019 / News

UBS AM launches three new ESG ETFs

Expert Investor

New index trackers offer exposure to Chinese and eurozone equities and emerging market bonds with ESG screening

UBS AM launches three new ESG ETFs

UBS Asset Management has unveiled three new ETFs that expand its ESG offering. UBS has teamed up with Stoxx, MSCI and JP Morgan to provide passive investors with the three new products.

Core eurozone ESG-screened blue-chips are now investible via the UBS ETF Euro Stoxx 50 ESG Ucits ETF.

The group said the product enables investors to receive similar performance characteristics to the standard Euro Stoxx 50 exposure, but with an additional ESG criteria factored in. Ten per cent of the lowest ESG-scored companies are excluded (in total 5 securities) and are replaced by better-scoring sector peers from the wider Euro Stoxx universe.

It also omits non-UN Global Compact Principle compliant companies and tobacco producers, controversial weapon producers, and those involved in thermal coal. This ETF is intended to be a core ESG-compliant building block for Eurozone blue-chip stocks.

In addition, Chinese equities that pass ESG screening criteria are now accessible for the first time passively via the UBS ETF MSCI China ESG Universal Ucits ETF.

The product physically replicates the MSCI China ESG Universal Index, which favours companies with a robust and an improving ESG profile, the group said.

“This ETF will appeal to investors looking to gain exposure to the wider Chinese economy, but with the added reassurance that the sustainable investment aspect has been accounted for,” the group said.

Investment grade USD denominated emerging market debt with a sustainability filter is also available via UBS ETFs.

The UBS ETF JP Morgan USD EM IG ESG Diversified Bond Ucits ETF offers a diversified source of investment grade EM yield in one package for bond investors.

Clemens Reuter, head of ETFs and passive investments, UBS Asset Management said: “The demand for sustainable investments is accelerating, and it is of great importance to us to help investors in achieving their ESG goals, whilst being invested across geographies and diversified across asset classes.”

The three new ETFs are available in USD, as well as currency hedged share classes (CHF, EUR and GBP). Listings will take place across key European exchanges including the London Stock Exchange, Deutsche Börse Xetra, Borsa Italiana and SIX Swiss Exchange.

  • This article first appeared on ESG Clarity’s sister title Expert Investor