On Wednesday, Krane Funds Advisors, LLC, (KraneShares), a global asset management firm known for its China-focused ETFs and innovative China investment strategies, announced the launch of the KraneShares MSCI China ESG Leaders ETF (KESG) on the New York Stock Exchange.
KESG tracks the MSCI China ESG Leaders 10/40 Index, a capitalization-weighted index that provides exposure to large and mid-cap companies in China with high ESG ratings relative to their sector peers. KESG’s index provider, MSCI, is the number one provider of ESG, Socially Responsible Investment (SRI) and, corporate governance indexes based on a survey of global institutions.
Over the past decade, a “New China” economy has developed with services surpassing manufacturing as the most significant contributor to China’s GDP. Typically, companies aligned with the “New China” economy experience higher growth than companies from China’s legacy sectors. MSCI’s ESG methodology not only identifies more socially responsible investment opportunities, but it can also be an effective filter for capturing companies aligned with the “New China” economy.
Since its inception in July 2013, the MSCI China ESG Leaders Index has outperformed the MSCI China Index by 76%. The 5-year annualized return of the MSCI China ESG Leaders Index was 10.51% as compared to just 5.32% from the MSCI China Index.
“Across markets and strategies, investments with high ESG ratings have become a priority to many investors – China is no exception,” said Jonathan Krane, CEO of KraneShares. “We are proud to partner with MSCI, a global leader in ESG indexing, to deliver a China-focused ESG strategy to our clients with the US-listing of KESG.”
For more information about KESG, visit kraneshares.com/kesg, or talk to your financial advisor.
This article originally appeared on ETFTrends.com.