The new ETF aims to capture the low-carbon leaders of the future.

Global asset management firm Krane Funds Advisors launched the KraneShares Global Carbon Transformation ETF (Ticker: KGHG) on the NYSE on March 16. To be managed by award-winning portfolio manager Roger Mortimer, the ETF will address the theme of decarbonization amidst climate targets. (Cision PR Newswire)

“Decarbonization is becoming increasingly important as pressure for companies to address climate change intensifies. Driven by political, strategic, and economic factors, the necessity for global carbon transformation could present one of the most disruptive and important investment opportunities of the next decade,” Krane said in a statement.

Global energy demand will grow 50% by 2050 and 80% of the world’s energy use is still fossil fuels. If we continue on this track scientists predict we could see catastrophic flooding and extreme weather events that could make large portions of the earth uninhabitable.

KraneShares Global Carbon Transformation ETF (NYSE: KGHG)

KGHG focuses on companies in traditionally high emissions industries that are on the cusp of the transition away from fossil fuels to renewable technology.

Companies in high impact industries that have a stated commitment and demonstrated action towards decarbonization may see superior growth compared to their peers as well as potentially benefit from a reevaluation and improved environmental, social and corporate governance (ESG) score.

Ukraine war

“The recent tragic events in Ukraine have brought the risk of energy dependency into sharp focus. We expect that the critically strategic nature of Europe’s energy crisis will result in accelerated policy implementation and capital spending in energy transition and resiliency,” said Roger Mortimer, KraneShares Portfolio Manager.

“These geopolitical concerns coupled with urgent climate objectives are increasing the awareness of the value of energy transition. KGHG will invest in companies around the world that are seeking to lead the race to decarbonize.”

KGHG carries an expense ratio of 0.89%.

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