Institutional investors have invested $ 1.25 billion in a new U.S. fund aimed at identifying the winners of the transition to a low-carbon world, making it the largest exchange-traded fund ever launched. ESG products..
The BlackRock US Carbon Transition Readiness Fund opened on Thursday, surpassing the iShares ESGM SCIUSA Leaders Fund, which debuted in May 2019 at $ 850 million and was the largest ETF list before.
A sister fund that invests in companies outside the United States also launched Thursday after raising $ 475 million from investors. This is also one of the largest new ETFs ever launched.
The new ETF will use the underlying stock indexes (Russell 1000 and MSCI All World ex-US indexes, respectively) to reflect the carbon transition readiness score, rather than excluding companies with low ratings on climate-related indicators. Assign portfolio weights.
Larry Fink, CEO of BlackRock, said:
“More and more capital is being allocated to sustainable strategies. These funds allow investors to understand which companies are migrating faster than others.”
ESG investment The aim is to fund companies with strong environmental, social and governance records. Total wealth in the sector increased 50% last year to a record $ 1.7 trillion, according to Morning Star.
Meanwhile, governments, businesses, Asset manager Is committed to achieving its net zero greenhouse gas emissions target by 2050. Carbon-neutral ETFs have been proposed as a way to drive and benefit from trends.
“These ETFs represent a way to find management that will change the way companies think about climate change,” said Christopher Isleman (Calstrs), Chief Investment Officer of the California State Teacher Retirement Program.
Many corporate leaders are focusing more and more on industry comparisons, including carbon dioxide emissions and how they affect stock prices, Ailman said. “What is measured and managed.”
Calstrs has donated $ 650 million to the new US ETF and $ 350 million to the Global Fund. Other investors that helped launch included Temasek, Sura Asset Management, Balma Mutual Annuity Insurer, Profturo Group, FM Global and Renaissance.
ETF companies are assessed on a “carbon transition readiness” score that reflects their reliance on energy production, clean technology, energy, waste and water management. Higher carbon reduction forecasts mean that companies are overvalued by ETFs compared to their industry rivals. The data is obtained internally by BlackRock via Aladdin Climate and from third-party providers such as MSCI, Sustainalytics and Refinitiv.
Ailman of Calstrs said companies that are actively transitioning to a low-carbon economy are expected to outperform and benefit investors in the long run.
“As long-term investors, we are looking for a big wave to ride. The transition to a low-carbon world will take time, but our portfolio needs to mitigate the risk of climate change. 2050 Investors need to start now to reach their previous net zero carbon goals. “
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BlackRock secures the largest ETF launch ever as the wave of green investment builds
Source link BlackRock secures the largest ETF launch ever as the wave of green investment builds