Invesco launches Global Clean Energy ETF
Invesco has launched the Invesco Global Clean Energy UCITS ETF providing investors in Europe with unique exposure to what the firm believes will be one of the world’s most important long-term investment themes.
Gary Buxton, Head of EMEA ETFs and Indexed Strategies at Invesco, says: “The biggest and arguably most urgent challenge facing the world is how to avoid climate catastrophe. The solution hinges on our transition to cleaner sources of energy, which is a diverse and rapidly evolving space. That is why we are so excited about offering investors access to the expertise of WilderHill. This California-based firm has been an industry leader since 2004 and constructed the first clean energy indices.”
The Invesco ETF will follow the WilderHill New Energy Global Innovation Index in tracking the performance of global companies whose innovative technologies focus on the generation and use of cleaner energy, energy conservation, efficiency and the advancement of renewable energy. This equally weighted index rebalances quarterly.
Dr Rob Wilder, Co-founder of WilderHill, says: “We have seen major fundamental changes to the clean energy space since solar and wind started breaking new ground in the noughties. First of all, the largest economies in the world are now committed to net-zero carbon objectives. Second, and even more significant, we now have economically viable alternatives to fossil fuels. In fact, solar will soon be the lowest- cost source of electricity generation. But it’s more than just solar panels, wind farms and electric cars. Decarbonisation will involve greater innovation, including finding ways to store and use energy more efficiently. And this is all happening now.”
By following this innovative index, the Invesco ETF will invest in companies focused in wind, solar, biofuels, hydro and other renewable energy sources as well as those involved in energy conversion, storage, conservation and efficiency. The ETF will also avoid companies with exposure to fossil fuels.
The index’s equal-weighted approach reduces concentration risk compared to a market-cap-weighted index and provides the ETF with meaningful exposure to the full breadth of opportunities in the diverse and constantly evolving clean energy space.
Buxton says: “We are committed to keeping investors at the forefront of ETF innovation and solutions. Tackling the environmental crisis is a key pillar in an ESG strategy, and we will continue bringing to market funds that enable investors to align their investments with their principles. Much more to come in 2021.”