Alternative Investments/ESG: DWS Unveils Suite Of High Dividend, Low Carbon ETFs

The new DWS ETFs are listed on Deutsche Börse Xetra.

DWS has unveiled a set of four high dividend ETFs in Europe, catering to environmentally conscious investors. These exchange-traded funds (ETFs) are linked to indices within the MSCI High Dividend Yield Low Carbon SRI Screened Select Index family, focusing on various regional markets, including global developed, US, European, and eurozone stocks. The quartet includes the Xtrackers MSCI World High Dividend Yield ESG UCITS ETF, the Xtrackers MSCI Europe High Dividend Yield ESG UCITS ETF, the Xtrackers MSCI EMU High Dividend Yield ESG UCITS ETF, and the Xtrackers MSCI USA High Dividend Yield ESG UCITS ETF. (ETF STRATEGY)

Notably, each of these ETFs maintains a low expense ratio of 0.25% and falls under Article 8 classification in accordance with the EU’s Sustainable Finance Disclosure Regulation (SFDR).

The methodology employed for these indices involves an initial screening of large and mid-cap stocks from the target region. It eliminates companies involved in international norm violations, severe ESG-related controversies, or possessing poor ESG profiles relative to their sector peers. Furthermore, the exclusions extend to companies linked to contentious industries such as arms manufacturing, fossil fuel extraction, adult entertainment, tobacco, nuclear energy, alcoholic beverages, and genetically modified organisms.

Subsequently, within the remaining selection of stocks, each index employs an optimization-driven method for the selection and weighting of constituents.

The primary aim is to maximize overall dividend yield while adhering to environmental goals, including a minimum 30% reduction in greenhouse gas intensity and a minimum 50% reduction in fossil fuel exposure. The optimization process ensures the best control of tracking errors concerning geography, sector, and constituent weights relative to the initial universe.

Related Story:  DWS Introduces A Range Of Factor-Based Equity ETFs With A Focus On ESG

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