Latest Launches

Newday adds sustainable development ETF

The company donates 5% of its net revenue to environment and social causes

Newday Impact recently launched its second ETF, an actively managed fund that seeks to invest in companies that adhere to the UN Sustainable Development Goals.

The San Francisco-based company’s Newday Sustainable Development Equity ETF invests at least 80% of its net assets in such holdings at its discretion. The company donates 5% of its net revenue to “environmental and social advocates to affect change,” it notes on its site.

The firm launched its first ETF, the Newday Ocean Health ETF, in June. Net assets in that ETF are about $1.4m.

At the time the company filed an initial prospectus for that fund, it also included one for another product, the Newday Diversity, Equity & Inclusion ETF, which does not appear to have launched.

The top holdings in the new Sustainable Development Equity ETF include stock in Apple, Microsoft, Stride, Amazon, McKesson, Tesla and Aflac. Net fees for the ETF are 75 basis points, according to the prospectus.

Newday is the subadviser to the fund, with Toroso Investments being the investment adviser.

Portfolio managers are Newday’s Gabriel Mass and Shireen Eddleblute, as well as Toroso’s Michael Venuto and Charles Ragauss.

New ETF centers on carbon trading futures

The Carbon Strategy ETF is listed on NYSE Arca

Another ETF has emerged as an early entrant in the carbon offsets investing market.

On Tuesday, Carbon Fund Advisors announced the launch of its Carbon Strategy ETF. The actively managed product invests in “a portfolio of liquid carbon futures that require ‘physical delivery’ of emission allowances issued under cap and trade regimes,” according to the summary prospectus.

It follows the launch in April of the KraneShares Global Carbon Offset Strategy ETF, which tracks carbon-offset futures contracts.

The new ETF run by Carbon Fund Advisors holds futures contracts on “carbon allowances in emissions trading in Europe and North America.” This includes European Union Allowances, California Carbon Allowances and the Regional Greenhouse Gas Initiative CO2 Allowances, the firm said in its announcement.

“Most investors do not have access to directly buy and sell carbon allowances in these systems, which is limited to those registered in an [emissions trading system],” Carbon Fund Advisors president Tim Collins said in the announcement.

“The Carbon Strategy ETF … opens the door to invest in a portfolio of carbon allowance futures at a time when global carbon prices are forecast to rise as the world aims to achieve the goals of the Paris Agreement.”

The ETF is listed on NYSE Arca and uses the Carbon Streaming BITA Compliance Index as its benchmark. The portfolio managers are Andrew Serowik, Todd Alberico and Gabriel Tan. The ETF has an expense ratio of 75 basis points.

JPM adds three active ETFs with ESG themes

The firm's other active sustainable ETF, Climate Change Solutions, launched in 2021

JP Morgan Asset Management brought three new ESG-themed ETFs to the market, the company announced late last week.

The new products, the JPMorgan Social Advancement, Sustainable Consumption and Sustainable Infrastructure ETFs, bring the company’s line of active sustainable thematic ETFs to at least four. The other ETF, the JPMorgan Climate Change Solutions ETF, launched in December.

“We are seeing strong demand from clients for active sustainable investing solutions that give them access to specific companies and sectors that are driving major global trends,” JP Morgan Asset Management CEO George Gatch said in the company’s announcement.

The Sustainable Consumption ETF invests in companies that stand to benefit from trends in natural resource preservation and waste reduction, the firm stated. That spans from material usage, production and design, to food and water. The ETF is managed by Sandeep Bhargava, Aijaz Hussain and Polina Diyachkina.

The Social Advancement ETF is intended to hold companies that stand to benefit from “economic empowerment of people across all levels of society and help people and communities survive and thrive,” the firm said. That includes holdings related to essential products, housing, health, education and financing. Raj Tanna, Jennifer Rabowsky and Bilquis Ahmed are managers of the fund.

The Sustainable Infrastructure ETF has holdings that address electricity, renewables, water, medical, social housing, education infrastructure and other areas, with infrastructure encompassing buildings, roads, bridges and other types, according to the firm. Sara Bellenda, Victor Li and Fred Barasi manage the ETF.

The firm’s Climate Change Solutions ETF represented about $21m in assets as of the end of July and had returned -20% at net asset value year-to-date, according to figures from the company’s site.

Line of new ETFs from Emerge all led by women

Emerge will also debut EMPWR, a program to encourage more women to be investment managers

Even as flows into ESG ETFs are slowing, Emerge is introducing its first set of active sustainable ETFs with a twist – each fund will be overseen by women. 

On Sept. 8, the investment management firm launched five different ESG exchange-traded funds, with versions listed on both the Cboe BZX Exchange in the US and the NEO Exchange in Canada. The funds invest in equity securities that exclude certain categories, according to prospectus documents, such as gambling, adult entertainment and chemical weapons.

When asked why Emerge was introducing these 10 funds while equity markets are limping and so-called anti-ESG funds are gaining traction, the firm’s CEO and founder Lisa Langley countered with, “Why not now?”

“We are taking a practical and real-world approach to sustainability,” Langley said in a phone interview. 

“ESG and sustainability work requires expertise and dedicated resources,” she added. “I think all the attention given to this area recently, albeit some negative, is because it does require those resources and it is expensive.”

Emerge’s new funds will each have an expense ratio of 0.85%.

Toronto-based Emerge is Canada’s first and only women-owned investment fund firm, with assets under management of C$120m ($91m US) at Emerge Canada and $800m at Emerge Capital, its US arm. 

Its five funds, built with Emerge’s proprietary ESG framework, will be listed in both the US and Canada. They are the Emerge EMPWR Sustainable Dividend Equity ETF (US ticker EMCA), Emerge EMPWR Sustainable Select Growth Equity ETF (EMGC), Emerge EMPWR Sustainable Global Core Equity ETF (EMZA), Emerge EMPWR Sustainable Emerging Markets Equity ETF (EMCH) and Emerge EMPWR Unified Sustainable Equity ETF (EMPW). 

“Issuers are constantly looking for new ESG approaches. This seems to be taking it a step further, saying not only invest in names which promote gender equality, but also through an issuer with aligned values,” Athanasios Psarofagis, an ETF analyst at Bloomberg Intelligence, said of the EMPWR funds. 

EMCA is sub-advised by Catherine Avery of Catherine Avery Investment Management. For EMGC, the sub-adviser is Cate Faddis of Grace Capital. EMZA will be sub-advised by Sonia Kowal and Jane Li of Zevin Asset Management, while EMCH will be overseen by Josephine Jimenez of Channing Global Advisors. EMPW will be managed by Langley. 

“We’re super excited,” Langley said of the fund managers. “They’re just wicked smart and they work so hard.”

In addition to launching these new funds, Emerge will also debut EMPWR, a program to encourage more women to be investment managers, especially for funds that promote sustainability, diversity and equity. 

Emerge already has other actively managed thematic ETFs, including a group of Canadian funds sub-advised by Cathie Wood’s Ark Investment Management, including the Emerge ARK Global Disruptive Innovation ETF (EARK), Emerge ARK AI & Big Data ETF (EAAI) and Emerge ARK Autonomous Tech & Robotics ETF (EAUT).

Direxion preps farming tech, EV ETFs

Rafferty Asset Management will advise the products

Direxion is prepping two ETFs that would invest in companies involved in farming and electric vehicle technology.

The company filed prospectuses Aug. 23 for the Direxion Future of Farming ETF and Direxion Electric and Autonomous Vehicles ETF, which would go live as soon as 75 days afterward.

Both of the index-tracking products would be advised by Rafferty Asset Management, with portfolio managers Paul Brigandi and Tony Ng overseeing them, according to the filing made with the Securities and Exchange Commission.

The Future of Farming ETF would track the S&P Kensho Sustainable Staples Index, investing in US public companies “that enable connected agricultural producers to enhance output while reducing waste and resource exhaustion using state-of-the-art sustainable practices,” the filing states. That also includes securities listed in the S&P Kensho Drones Index, Robotics Index, 3D Printing Index, Genetic Engineering Index and Space Index, along with the Sustainable Farming Index.

The other product, the Direxion Electric and Autonomous Vehicles ETF, would track the Indxx US Electric and Autonomous Vehicles Index. That index includes companies with at least 50% of revenue related to electric or autonomous vehicle manufacturing, infrastructure, such as charging docks or software, and technology.

Calvert files for first ETFs

Morgan Stanley Investment Management will serve as adviser to the funds

Calvert has filed initial registration papers for its first ETFs — a line of products that lists Morgan Stanley Investment Management as the adviser.

The fund provider, which is part of the Morgan Stanley-owned firm Eaton Vance, filed with the Securities and Exchange Commission on Aug. 13 for four products. Those include the Calvert International Responsible Index, US Large-Cap Core Responsible Index, US Large-Cap Diversity, Equity and Inclusion Index and US Mid-Cap Core Responsible Index ETFs.

Each of those passively managed products would track a similarly named index built by Calvert, according to the filing. The ETFs could launch “as soon as practicable” after the effective date of the registration statement. Typically, subsequent prospectus filings known as 485APOS place a start date 75 days afterward.

The products appear to be the first ETFs provided by Calvert, Gabe Denis, the lead Morningstar analyst covering Morgan Stanley, said in an email statement.

“We are seeing many firms enter the ETF space, both to complement (or even replace) existing open-end funds and to launch completely new strategies. The reasons vary and can include wishing to provide a strategy in a potentially more tax-effective (and often cheaper, for investors) vehicle or to appeal to new investor bases and distribution channels,” Denis said. “It will take time to assess how investors react to these new ETFs and how they will sit alongside Calvert’s existing open-end mutual fund offerings.”

Search ESG Clarity