Amundi boosts low carbon offering
Amundi has expanded its low carbon offering with the launch of three funds in Europe.
The company launched two open-ended index funds: the Amundi Index Equity Global Low Carbon and the Amundi Index Equity Europe Low Carbon. These funds replicate the MSCI World Low Carbon Leaders and the MSCI Europe Low Carbon Leaders indices respectively.
The third product is an ETF tracking the MSCI World Low Carbon Leaders index, listed today on Euronext Paris, and then cross-listed on the main European markets;
The MSCI Low Carbon Leaders indexes were launched in September 2014 by index provider MSCI, having been developed with Amundi and two major European pension funds.
The MSCI Low Carbon Leaders’ methodology aims to achieve at least a 50% reduction in the level of carbon emissions (present emissions and reserves representing potential future emissions) compared to the parent indexes, while minimizing the tracking error relative to them. Each strategy index will, however, retain a sectorial and geographical composition similar to its parent index.
The strategy indexes, therefore, exclude:
– 20% of stocks in the parent index universe, based on the “carbon emission intensity criteria”, defined as the weight of carbon emissions (tons of CO2) of a company relative to market capitalisation, with a maximum exclusion of 30% for each sector market capitalization
– and also the largest owners of carbon reserves per dollar of market capitalization, representing at least 50% of the reserves in the parent index.
Valerie Baudson, global head of ETF, Indexing and Smart Beta at Amundi, said: “It is very gratifying to see that combining low carbon exposure and low tracking error is resonating so significantly with investors. Our recent development in this area, along with our close involvement in the Portfolio Decarbonization Coalition, illustrates our determination to address client investment needs effectively.”
Until recently, there have been few scalable solutions available to investors seeking to address the financial risk of climate change and carbon exposure. With these innovative funds, Amundi’s objective is to allow all types of investors to access low carbon intensity strategies, via listed and unlisted funds
The Amundi Index Equity Global Low Carbon and the Amundi Index Equity Europe Low Carbon are available through different, competitively priced, share classes, designed for all types of investors, with different minimum subscription levels and ongoing charges ranging from 0.09% to 0.60%.
The ETF is proposed with a TER of 0.25%.