BlackRock has launched a new thematic equity ETF in the US called the iShares Breakthrough Environmental Solutions ETF, which provides global exposure to companies with recent technological innovations aimed at addressing the climate transition. The ETF is linked to the Morningstar Global Emerging Green Technologies Select Index and targets companies in eight themes, including green transportation, renewable energy, and sustainable agriculture. The index utilizes a light ESG screen to remove violators of UN Global Compact principles and companies linked to controversial weapons, tobacco, civilian firearms, thermal coal, and oil sands. Morningstar then utilizes its analyst research to screen for companies deriving at least 25% of their revenue from products or services based on emerging green technologies. All Tier 1 stocks are selected for inclusion, and if the index contains less than 50 constituents, the methodology also selects the Tier 2 stocks with the highest Innovation Scores until the threshold is met.
BlackRock Launches iShares Breakthrough Environmental Solutions ETF Focusing on Green Technologies to Address Climate Change
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The ETF has an expense ratio of 0.47%. As of March 29, stocks from the US accounted for a little over a quarter of the index weight with China, Japan, Germany, and Switzerland also having notable exposure.