Amundi has expanded its offering of sustainable fixed income ETFs by introducing a broad euro government bond fund with a significant allocation to ‘green’ issues.
Arnaud Llinas, Head of ETF, Indexing, and Smart Beta at Amundi.
The Amundi Euro Government Tilted Green Bond UCITS ETF has been created by transforming the existing Amundi Govt Bond Euro Broad Investment Grade UCITS ETF which has approximately €500 million in assets under management.
According to Amundi, the revamped ETF enables investors to shift their core euro government bond allocation towards a responsible exposure that is aligned with the energy transition.
Arnaud Llinas, Head of ETF, Indexing & Smart Beta at Amundi, said: “Clients have asked for innovative solutions combining sovereign bond investments with an ESG stance, and we believe this new ETF is a great addition to our product range and a concrete investment tool to finance the transition to a low carbon economy.”
Methodology
The ETF is now linked to the Bloomberg Euro Treasury Green Bond Tilted Index which is constructed from the parent Bloomberg Euro Treasury €50bn Bond Index, a broad reference for investment-grade, euro-denominated, fixed-rate government debt issued by eurozone countries with at least €50 billion in issuance. Eligible bonds must have at least one year remaining until maturity.
The methodology adjusts the constituent weights of the parent universe such that the total weight of green bonds – bonds whose proceeds are specifically earmarked for projects with a direct environmental benefit – is at least 30%. The process satisfies the green bond allocation requirement while simultaneously maintaining an overall risk profile that is comparable to the parent universe in terms of duration, country allocation, and tracking error.
Dave Gedeon, CEO of Bloomberg Index Services, said: “The Bloomberg Euro Treasury Green Bond Tilted Index is a new index solution that we believe can be the standard for inclusion of ESG factors in Treasuries. Ensuring we create indices that directly address concerns of the global investment community is always top of mind and so we are proud to license this new index to Amundi for their ETF.”
The ETF has an expense ratio of 0.14% and is classified as an Article 8 product under the European Union’s Sustainable Finance Disclosure Regulation (SFDR).
It is listed on Deutsche Börse Xetra (CB3G GY), Euronext Paris (CB3 FP), Borsa Italiana (CB3 IM), and SIX Swiss Exchange (CB3 SW) in euros.