Alternative Investments/ESG: DWS Introduces A Range Of Factor-Based Equity ETFs With A Focus On ESG
The DWS global equity factor range of four ETFs is now available in an ESG avatar.
DWS has introduced a series of exchange-traded funds (ETFs) that offer an environmental, social, and governance (ESG) version of its global equity factor ETFs range. These ETFs, listed on the Deutsche Boerse and the London Stock Exchange, have a total expense ratio of 0.25%. The funds track MSCI indices and focus on low carbon metrics and socially responsible investing, targeting large and mid-cap companies from developed countries.
The ETFs in the range include Xtrackers MSCI World Minimum Volatility ESG UCITS ETF (XWEB), Xtrackers MSCI World Momentum ESG UCITS ETF (XWEM), Xtrackers MSCI World Quality ESG UCITS ETF (XWEQ), and Xtrackers MSCI World Value ESG UCITS ETF (XWEV).
The selection and weighting of companies will be based on MSCI’s factor approach. The DWS ETFs apply different strategies, such as minimizing risk, selecting stocks with strong price performance, and using quality metrics or valuation indicators. (ETF STREAM)
Companies with low MSCI ESG ratings or involvement in certain industries like nuclear weapons, tobacco, alcohol, gambling, fossil fuel extraction, and thermal coal are excluded, as well as those not complying with the United Nations Global Compact principles.
The index constituents are chosen through an optimization process that considers climate, environmental, and social objectives, including reducing greenhouse gas emissions and active fossil fuel exposure. These ESG ETFs are offered at the same price as their non-ESG counterparts and currently have a combined £2.7 billion in assets under management.
This launch follows the introduction by DWS of the Xtrackers J.P. Morgan EM Local Government Bond UCITS ETF (XEML) in May.
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