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March 13, 2017 at 06:24 AM
VanEck launched the first U.S.-listed fixed income ETF to provide targeted exposure to the fast-growing green bond category: VanEck Vectors Green Bond ETF (GRNB).
“Until now investors have had limited options for efficiently accessing ‘green’ fixed income exposure,” Ed Lopez, head of ETF Product Management and Marketing with VanEck, said in a statement.
Green bonds are debt instruments issued to finance projects or activities that promote climate change mitigation or adaptation, or for other environmental sustainability purposes, and, according to VanEck, appear poised for significant growth.
Indeed, Natixis Asset Management U.S. recently filed plans with the SEC to launch the first ESG-focused target date funds, which will include green bond funds in the mix.
(Related on ThinkAdvisor: Natixis Plans First Target-Date Suite Focused on ESG: Top Portfolio Products)
Issuance of green bonds has grown rapidly since the European Investment Bank issued the first green bond in 2007, according to VanEck. It cites data from the Climate Bonds Initiative, an investor-focused non-profit organization working to promote low-carbon investments, showing that $81 billion of green bonds were issued in 2016 and $150 billion is expected to be issued in 2017.
“We believe there’s demand for green bonds from ESG-focused investors, but there may be appeal to traditional fixed income investors as well,” Lopez said in a statement. “Green bonds are simply conventional bonds with an environmentally friendly use of proceeds. So, global bond investors can make an allocation to green bonds without significantly altering the risk and return profile of their portfolio.”
GRNB seeks to track the performance and yield characteristics of the S&P Green Bond Select Index (SPGRNSLT). To be included in the fund’s underlying index, a bond’s issuer must clearly disclose the rationale for the issuance, such as the use of proceeds, and the bond must be flagged as “green” by the CBI. All bonds must be rated by at least one rating agency and additional filters are applied with respect to minimum par amount outstanding, maturity, and market of issue. The Index is weighted by market value, and includes a 10% issuer cap and a maximum allocation of 20% to high yield.
Morgan Stanley Wealth Management Launches Two Sustainable Investing Portfolios with Reduced Account Minimums
Morgan Stanley Wealth Management launched two sustainable investing model portfolios with reduced account minimums of $10,000 on its “Investing with Impact” platform.
These new portfolios – Investing with Impact Access Balanced and Investing with Impact Access Equity – will provide investors with diversified goal-specific solutions to help align financial goals with personal values.
The Investing with Impact Access Portfolios leverage the asset allocation expertise of Wealth Management Investment Resources, the rigorous investment manager evaluation and due diligence from the Global Investment Manager Analysis (GIMA) team and the investment product selection and portfolio construction recommendations from the Manager Solutions team. Eligible investments include mutual funds and exchange-traded funds (ETFs) approved by the GIMA team.
Franklin Templeton Launches a Crowdfunding Tool for College Savings
Franklin Templeton Investments announced the launch of its new crowdfunding tool, designed exclusively for NJBEST and Franklin Templeton 529 College Savings Plan account holders.
Spryng (pronounced “spring”) was developed in house to harness the power of crowdfunding and social media, by creating a secure and convenient method to engage family and friends in saving for future higher education expenses.
The account owner can create a Spryng profile quickly, which can be customized with a picture, personal message and information on savings goals. Once the profile is established, Spryng generates a secure URL that can be emailed or shared with potential gift givers via various social media platforms.
