State Street Lists Latest S&P 500 ESG ETF
29 July 2020 - 1:07AM
Dow Jones News
By Dieter Holger
State Street Global Advisors has become the latest investment
firm to launch an exchange-traded fund that invests in the
sustainable version of the bellwether S&P 500 index.
The Boston-based money manager, which has around $3 trillion
under management, said its new ETF trading under the ticker symbol
EFIV tracks the S&P 500 ESG Index that debuted in April
2019.
The index is overweight on tech, with Microsoft Corp., Apple
Inc., Amazon.com Inc., Facebook Inc. and Google parent Alphabet
Inc. among its top holdings. State Street's new ETF charges an
expense ratio of 0.10% or $10 for every $10,000 invested a
year.
After screening out companies involved in tobacco or
controversial weapons, or with a low United Nations Global Compact
score, the S&P 500 ESG Index aims to hold as many companies
with high ESG scores by targeting 75% of the parent benchmark
market cap by specific industry groups.
As of this year's rebalance, 311 members of the S&P 500 made
it in the index and 56 were excluded, while another 138 were
eligible but not selected.
State Street joins other top investment firms that have launched
ETFs based on S&P's ESG index as more and more investors seek
out funds with stricter sustainability requirements.
"The collective call for change is growing louder and investors
are increasingly taking a stand through their investment choices,"
said Sue Thompson, head of SPDR Americas distribution at State
Street Global Advisors, in prepared remarks.
In April last year, UBS Group AG was the first firm to list an
ETF based on the index, the UBS ETF S&P 500 ESG UCITS ETF
listed in Europe.
Then in June of last year, German money manager DWS Group GmbH
& Co. KGaA launched in the U.S. the Xtrackers S&P 500 ESG
ETF, trading under SNPE, that now holds some $234 million in
assets.
Invesco Ltd. also has exchange-traded funds tracking the index:
the Invesco S&P 500 ESG Index ETF listed in Canada and the
Invesco S&P 500 ESG UCITS ETF listed in Europe.
In January, S&P and BlackRock Inc., the world's largest
money manager with close to $7 trillion in assets, agreed to create
ESG versions of the S&P's flagship indexes for new sustainable
funds.
BlackRock forecasts that sustainable investments in
exchange-traded and index funds world-wide will soar to $1.2
trillion by 2030. It said there was around $220 billion in such
funds at the end of last year.
Write to Dieter Holger at dieter.holger@wsj.com;
@dieterholger
(END) Dow Jones Newswires
July 28, 2020 10:52 ET (14:52 GMT)
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