On Thursday, AXS investments launched the second environmental, social and governance exchange-traded fund in its lineup.
The firm rolled out the actively managed AXS Green Alpha ETF (NXTE), which will focus on sustainable companies and be subadvised by Green Alpha Advisors, a firm that looks to invest in companies addressing system-level risks.
NXTE comes with an expense ratio of 1.00% and lists on the NYSE Arca. That cost places it at the upper end of the range for ESG ETFs.
Green Alpha’s approach to investing is based on its four pillars of sustainability, which include companies that are efficiently making large and rapid gains in productivity; embracing renewable energy; reducing reliance on geological resources and reusing those materials; and supporting equitable distribution of wealth in order to ease civil unrest and the risks that come with that, according to NGTE’s prospectus. Companies considered for investment must contribute to at least one of the four pillars identified by the firm.
The fund’s managers will further evaluate a company’s source of revenues and its capital expenditure priorities; its demonstrated commitment to sustainability; and its social, employment and governance practices.
From there, the portfolio’s holdings are chosen from the pool of acceptable companies via a bottom-up selection process that considers a range of fundamental and valuation factors, the document says.
At launch, the fund included CRISPR Therapeutics AG, Vestas Wind Systems A/S and Taiwan Semiconductor Manufacturing Co. among its top holdings in a portfolio of nearly 60 securities.
AXS acquired the AXS Change Finance ESG ETF (CHGX), which has $94 million in assets under management, earlier this year. The fund tracks an index of 100 large cap U.S. stocks that are selected based on ESG and sustainability criteria.
Contact Heather Bell at [email protected]