Alternative Investments/ESG: Fidelity Debuts Climate-Focused, Global Bond ETF In Europe

The new Fidelity ETF comes with an expense ratio of 0.20%.

Fidelity International has launched a new fixed income ETF in Europe, targeting climate-conscious investors. The Fidelity Global Government Bond Climate Aware UCITS ETF is designed to provide exposure to a portfolio of local currency government bonds issued across the world while delivering an immediate reduction in the carbon emissions profile compared to similar market cap-weighted benchmarks.

The ETF, listed on several exchanges and classified as an Article 8 product under the EU’s Sustainable Finance Disclosure Regulation, is linked to the Solactive Paris Aware Global Government Bond Index. The index utilizes an optimization process to determine the weights of individual countries to achieve an immediate reduction in carbon emissions of at least 14% compared to the initial universe and a further annual decarbonization at a rate of 7%. (ETF Strategy)

Nick King, head of ETFs at Fidelity International, said: “Sustainable investing is a key priority for many of our clients and often they are focused on managing climate change through their investment allocations.”

“This new ETF provides investors with a highly diversified global government bond exposure aligned to climate objectives. This expands our existing range of climate-focused fixed income ETFs, providing innovative, cost-effective building blocks for asset allocation.”

Fidelity also offers two other climate-tailored fixed income ETFs, targeting investment-grade and high yield corporate bond markets globally.

These ETFs provide actively managed exposure and select constituents based on a proprietary multifactor credit model combined with integrated sustainability criteria, with issuers weighted to achieve a 50% reduction in weighted average carbon intensity compared to the initial universe and a further 7% annual decarbonization.

Related Story: Fidelity Launches Crypto And Metaverse Themed ETFs

Image by Kevin Snyman from Pixabay

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