Liquid Alternatives: Lyxor Launches High Yield Bond ETFs With ESG Exposure

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Lyxor launches three new ETFs for investors looking to invest in high yield bonds with a sustainability angle.

Lyxor’s new ETFs have a total expense ratio (TER) of 0.25%. This is the lowest TER among ETFs tracking High Yield indices with ESG filters. (ETFExpress)

The ETFs and their listing details are:

  • Lyxor Euro High Yield Sustainable Exposure UCITS ETF – Acc [Borsa Italiana (EHYS)]
  • Lyxor USD High Yield Sustainable Exposure UCITS ETF – Acc [Borsa Italiana; LSE (UHYS)]
  • And the Lyxor Global High Yield Sustainable Exposure UCITS ETF – Acc [Borsa Italiana (GHYU); LSE (GHYE)]

The new ETFs and sustainability

The new ETFs will track the Bloomberg Barclays MSCI Sustainable SRI indices, which apply sustainability filters to the bond universe to reduce exposure to controversial and low-ESG-rated issuers. It will filter out issuers with low ESG scores and/or who materially involve in controversial industries. Furthermore, they must have a minimum MSCI ESG rating of BBB.

The fund house introduced the world’s first Green Bond ETF in 2017 and believes that sustainable fixed income ETFs will attract growing investor interest.

“ESG rating in High Yield is one of the latest innovations in fixed income indexing,” said Philippe Baché, Head of Fixed Income at Lyxor ETF. “By applying an ESG lens to the High Yield bond universe, we are able to provide a significant move away from parent indices offering a potentially more conservative risk profile.”

Related Story:  BlackRock Makes Big ESG Push on ETFs

Image Credit (no changes were made): Flickr                     

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