ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About Us
    • Swag Store
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Climate Insights Channel
  2. Consider Decarbonizing Companies for Better ESG Returns
Climate Insights Channel
Share

Consider Decarbonizing Companies for Better ESG Returns

Karrie GordonApr 29, 2022
2022-04-29

The influx of funding into ESG in recent years has been a boon for the space, but with many of the companies with top credentials already heavily invested in, diminishing returns have meant that some fund managers are swimming further into the pool to find better opportunities.

This means that some asset managers are adding companies working to decarbonize piecemeal to their portfolios, but the KraneShares Global Carbon Transformation ETF (KGHG ) offers an entire fund focused on the future industry leaders in decarbonization. KGHG seeks to capture the true potential within the carbon transition by focusing on companies from within industries that are traditionally some of the highest emission offenders but that are on the precipice of transitioning to renewable technologies.

These companies that are set to disrupt their industries would benefit greatly from being leaders in the transition, as the cost of carbon emissions will only become more expensive, cutting into the bottom line as demand decreases for high emissions offenders. Investment into today’s offenders that are in the process of transitioning to become decarbonization leaders within their industries also offers the opportunity for greater return potential for investors.

“The traditional gold rush in ESG has been to buy the best companies, the winners, and it worked. But as more and more people were chasing the same opportunities, the performance got less and less,” Kasper Elmgreen, head of equities at French fund firm Amundi, told the Wall Street Journal. “You’re investing in companies that are already great, so how much greater can they be?”

The Return Potential for Companies Working to Decarbonize

nvesting in companies that might have lower ESG ratings than some of their peers within their industry but are in the process of transitioning to lower-emissions practices typically means that shares are undervalued relative to both their earnings potential and their ESG trading premiums over time.

“If companies are positioning themselves for a sustainable future, you should see an increase in brand value, customer and employee loyalty and additional competitive advantages,” said Casey C. Clark, president and CIO at Rockefeller Asset Management.

KGHG is an actively managed fund that invests globally across market caps in sectors in carbon emissions reducers that are taking active steps to reduce their own carbon footprints or the carbon footprints of other companies. This also includes companies within the supply chain of the carbon-reducing companies and companies that are growing their businesses with others that are materially reducing carbon emissions.

The fund utilizes proprietary, fundamental, bottom-up analysis using information disclosed by companies and third-party data.

KGHG carries an expense ratio of 0.89%.

For more news, information, and strategy, visit the Climate Insights Channel.


Content continues below advertisement

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X