DWS has launched two new actively managed ETFs in Europe, providing exposure to companies distinguished by significant research and development activities in green technologies.
The ETFs target companies driving innovation in the green transition.
The Xtrackers World Green Transition Innovators UCITS ETF (GTIL) and the Xtrackers World Small Cap Green Transition Innovators UCITS ETF (GTIS) are listed on the London Stock Exchange and Xetra.
GTIL selects its constituents from a universe of large-cap, developed market equities, while GTIS targets mid- and small-stocks from the same global universe.
The ETFs align with key sustainability goals set by the United Nations and the European Union, emphasizing climate neutrality and resource conservation.
These funds are designed to focus on companies identified as innovators in the green transition space, leveraging patent data analyzed by Quant IP GmbH. This analysis uses the IPC Green Inventory of the World Intellectual Property Organization, which standardizes the allocation of patents to defined Environmentally Sound Technologies (EST). This patent-based approach provides an objective and transparent method to evaluate the innovative strength of companies.
Studies have shown a correlation between patent activity and value growth, suggesting that firms with robust patent portfolios often exhibit above-average excess returns and earnings growth. By targeting companies with significant patent activity in green technologies, the ETFs aim to capture firms poised for long-term success.
Each ETF targets approximately 200 stocks, weighted roughly according to market capitalization, ensuring diversified exposure.
GTIL and GTIS come with expense ratios of 0.35% and 0.45%, respectively, and are classified as Article 8 products under the European Union’s Sustainable Finance Disclosure Regulation (SFDR).
Michael Mohr, Global Head of Xtrackers Product at DWS, commented: “The Xtrackers World Green Transition Innovators ETFs are of interest to investors looking to add an innovation-oriented, green technology-focused component to their portfolios.”