On Wednesday, Xtrackers ETFs by DWS launched the first ETFs providing exposure to ESG versions of the S&P MidCap 400 and S&P SmallCap 600 indices.
The Xtrackers S&P MidCap 400 ESG ETF (NYSE Arca: MIDE) and the Xtrackers S&P SmallCap 600 ESG ETF (NYSE Arca: SMLE) are now listed, further expanding the Xtrackers footprint in the rapidly growing area of values-based index investing. Assets under management in Xtrackers NYSE-listed ESG ETFs reached over USD 3 billion in 2020.
Arne Noack, DWS’s Head of Systematic Investment Solutions, Americas, commented: “At DWS, we have made ESG-centric investing integral to our value proposition for our clients, and the launch of MIDE and SMLE is a logical follow-on. We seek to provide investors with transparency around relevant ESG-metrics of a potential investment. Investors can, for example, easily view the reduction in the carbon footprint of the underlying companies compared to a non-ESG benchmark. This level of transparency is important for investors and intermediaries seeking credible ESG alternatives to mainstream equity indices.”
The ESG methodology underpinning the funds starts by taking the established S&P mid and small-cap indices then applying exclusions and rankings filters to produce the ESG indices the ETFs track. Both the Xtrackers S&P MidCap 400 ESG ETF and Xtrackers S&P SmallCap 600 ESG ETFs have net expense ratios of 0.15 percent.
New And Improved
“We’re very pleased to collaborate with DWS as it launches these new ESG ETFs in the U.S. By representing the U.S. mid- and small-cap equities market with improved sustainability profiles, the S&P MidCap 400 ESG and S&P SmallCap 600 ESG indices signify a new sustainable frontier in a space left largely untouched by sustainable indexing to date,” said Mona Naqvi, Senior Director, Head of ESG Product Strategy, North America, S&P Dow Jones Indices.
“As the first of their kind, these indices are poised to help raise reporting and sustainability standards among medium and small-sized companies as they seek to join the ranks of ESG indices. As such, ESG investing is no longer just a large-cap solution, it is now an all-cap solution.”
Amanda Rebello, Head of Passive Sales, U.S. onshore, commented: “We are pleased to be the first in the industry to launch ETFs for the S&P MidCap and SmallCap ESG indices. With their competitive net expense ratios, the ETFs can be used as core portfolio building blocks.”
The new listings complement the Xtrackers S&P 500 ESG ETF (NYSE Arca: SNPE), which launched in June 2019 and has over USD 400 million in assets under management. DWS is recognized for its expertise in ESG ETFs. Its ESG range was awarded ‘ETF Suite of the Year’ at Fund Intelligence’s Mutual Fund Industry and ETF Virtual Awards 2020.
For more information, visit www.Xtrackers.com.
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