Alternative Investments/ESG: Fidelity Launches ETFs For Sustainable Corporate Bonds
For the first time, fixed income ETFs from Fidelity.
Fidelity International has launched its first fixed income ETFs, and the two new funds come with the added benefit of a sustainable skew. The Fidelity Sustainable Global Corporate Bond Multifactor and Fidelity Sustainable USD EM Bond UCITS ETFs offer a “systematic active strategy” to investors while utilizing the firm’s proprietary analyst research. (Investment Week)
Both ETFs will list on the London Stock Exchange, Deutsche Boerse, and SIX Swiss Exchanges.
They are classified under article 8 of the EU Sustainable Finance Disclosure Regulation, which requires the funds to “promote environmental and/or social characteristics.”
Fidelity Sustainable Global Corporate Bond Multifactor ETF (FSMF)
Featuring an ongoing charge of 0.25%, this ETF tracks the Bloomberg Barclays Global Aggregate Corporate index.
The fund selects lucrative bonds as identified by Fidelity’s proprietary multi-factor credit model refined by filtering through sustainability criteria. The model assigns due importance to factors such as sentiment, valuation, fundamentals, and ESG.
Fidelity Sustainable USD EM Bond UCITS ETF (FSEM)
This ETF gives investors exposure to the sovereign debt of emerging markets analyzed with reference to the company’s overall debt, sustainability ratings, and external ESG ratings.
The ETF features an ongoing charge of 0.45%.
It tracks the JP Morgan ESG EMBI Global Diversified index.
Nick King, head of ETFs, Fidelity International, said: “I am delighted to expand our ETF range with the launch of our first fixed income exchange-traded products. Incorporating sustainable investing principles has become the key priority for many of our clients globally and we can now offer access to our proprietary research capabilities across asset classes in a transparent, cost-effective structure.”
“Combining the very best of our active research platform and sustainability expertise with best-in-class portfolio construction techniques, our systematic fixed income can create low-cost portfolios tailored to our clients’ specific needs,” he added.
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