ESG Filings Stand Out Over Past Month

October 10, 2022

The past month or so has seen a wide range of filings for new exchange-traded funds from a variety of issuers. Interestingly, many of the ETFs in the pipeline are in the ESG vein, despite something of a backlash against the concept lately amid concerns about greenwashing and attacks on “woke” investing.  

BlackRock’s iShares unit has filed for another trio of ESG funds following its “Aware” methodology, which applies ESG criteria to its target universe with the intent of aligning with the risk and return characteristics of the parent index. iShares also offers an “Advanced” ESG methodology, that applies a more stringent set of ESG criteria to its universe without regard for correlation with parent indexes. 

The iShares filings include value and growth versions of the $21.1 billion iShares ESG Aware MSCI USA ETF (ESGU), while another fund, the iShares ESG Aware ICE-HIP Muni Bond ETF, will invest in municipal debt securities. None of the filings include expense ratios, tickers or listing exchanges. 

State Street has filed for the SPDR MSCI ACWI IMI ex Tobacco Fossil Fuel Reserves Free ETF. Not only does the fund exclude companies from the energy and utilities sectors as well as the diversified metals and mining subindustry that own fossil fuel reserves, it excludes companies that are classified within the tobacco subindustry. 

TrueShares has filed for the TrueShares Eagle Global Renewables Income ETF, which focuses on companies involved in the alternative and renewable energy space, selecting companies through a fundamentally driven investment approach.  

Single-Stock ETFs 

REX Shares filed for another eight single-stock ETFs offering two times leveraged exposure to “meme stocks” MicroStrategy Inc., Coinbase Global Inc., GameStop Corp., AMC Entertainment Holdings Inc., Peloton Interactive Inc., Tilray Brands Inc., Nikola Corp., Robinhood Markets Inc., Beyond Meat Inc. and PENN Entertainment Inc.  

The issuer had previously filed for eight ETFs offering inverse exposure to those same eight stocks.  

Commodity ETFs 

Among the filings were multiple ETFs targeting the commodity space. The KraneShares Bloomberg Transitional Commodities Strategy ETF will hold a combination of futures contracts and equity securities related to the transition away from fossil fuels toward lower-carbon energy sources.  

The fund will hold futures contracts on copper, aluminum and nickel, which are all used in clean energy technologies such as electric vehicles; carbon credits; and clean-energy-related commodities such as corn, soybean and natural gas. The equity portion of the fund is capped at 15% of the underlying index and covers equities tied to commodities that do not have liquid futures markets such as polysilicon, lithium, cobalt and graphite.  

Teucrium also filed for the Teucrium AiLA Long-Short Agriculture ETF (OAIA) and the Teucrium AiLA Long-Short Base Metals ETF (OAIB), which are both tied to the AiLA-S033 Market Neutral Absolute Return Index. The commodities covered by the index include corn, soybeans, soybean meal, soybean oil, wheat, Arabica coffee, cotton, NY cocoa and #11 sugar. The index’s methodology allocates to the different futures contracts based on a variety of signals and criteria. 

Equity Funds 

Pacer also filed for a growth version of its $7.6 billion Pacer U.S. Cash Cows 100 ETF (COWZ). The Pacer US Large Cap Cash Cows Growth Leaders ETF, like COWZ, focuses on companies with high levels of free cash flow, but it also incorporates a price momentum score into the methodology.  

Dimensional Fund Advisors filed for another two actively managed funds, the Dimensional US Large Cap Value ETF and the Dimensional Global Real Estate ETF. The former targets companies exhibiting smaller size characteristics, lower valuations and higher profitability, while the latter targets REITs and REIT-like companies at the global level and considers a wider range of criteria. 

 

Contact Heather Bell at [email protected] 

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