Alternative Investments/ESG: Amidst Climate Change, An ETF For Exposure To Disaster Recovery

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The Procure Disaster Recovery Strategy ETF is debuting Wednesday under the ticker FEMA.

ProcureAM, a subsidiary of Procure Holdings LLC, launches the Procure Disaster Recovery Strategy ETF (FEMA) which invests in companies in the businesses of sustainable recovery and risk reduction efforts related to natural disasters. (InsuranceJournal)

Disaster recovery companies

The ETF tracks the VettaFi Natural Disaster Response and Mitigation Index, an equal-weighted index comprising four investment categories: climatological, geophysical, hydrological, and meteorological. Index constituents include companies that are materially involved in emergency/backup power generators and batteries, engineering and construction, specialty industrial machinery, building products and materials, as well as waste management, among other areas.

Companies that received contracts with the Federal Emergency Management Agency or similar agencies in the last five years also qualify for inclusion in the fund.

As climate change intensifies the frequency and costs of natural disasters around the world, the companies in the fund will see growing demand for their products and services, according to Andrew Chanin, co-founder of ProcureAM.

The market is huge. Since 1980, the United States alone has sustained 323 weather and climate disasters, costing $2.2 trillion dollars in total. By the end of this century, the U.S. government predicts $2 trillion per year in damages from hurricanes, wildfires, floods, droughts, severe storms, and earthquakes.

“The unfortunate reality is natural disasters can strike anywhere at any time and displace millions of people. Without restoration companies there to help us recover and build back, the damage would be even more devastating,” added Chanin. “The FEMA ETF is an opportunity to invest in critical renewal and recovery efforts.”

The ETF has an expense ratio of 0.75%.

Related Story: AI Could Bring Us Fresh Insight Into Earthquakes

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