State Street Global Advisors on Friday launched the SPDR MSCI ACWI Low Carbon Target ETF (LOWC), an exchange-traded fund aimed specifically at low-carbon emitting companies.
The fund tracks the MSCI ACWI Low Carbon Target Index that overweights companies with low carbon emissions relative to sales and per dollar of market capitalization.
LOWC’s portfolio is heavy on the financials (23 percent), and has double-digit stakes in the info tech, health care, consumer discretionary and consumer staples sectors. In addition, and somewhat surprisingly, industrials comprise a little more than 12 percent of the portfolio.
The top five holdings are large-cap stalwarts Apple, Microsoft, Johnson & Johnson, General Electric and Wells Fargo.
U.S.-based companies make up more than 51 percent of the ETF, and the U.S. is the only country with a double-digit representation in the fund.
According to the fund’s fact sheet, LOWC is a broad-based ETF with nearly 1,300 holdings that collectively sport a price-to-earnings multiple of nearly 16 and a weighted average market cap of more than $89 million. The fund’s gross expense ratio is 0.30 percent.
State Street appears to have the low-carbon angle to itself—at least for now. BlackRock’s iShares ETF division has filed registration with the Securities and Exchange Commission for the iShares MSCI ACWI Low Carbon Target ETF that, as the name applies, tracks the same index used by the SPDR MSCI ACWI Low Carbon Target ETF.
Sounds like the makings for a fee war between two potentially identical funds.