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BNP Paribas Asset Management has launched a trio of new ETFs on Euronext Paris.
BNP Paribas has launched two new thematic equity ETFs and a global green real estate fund on Euronext Paris.
The BNP Paribas Easy ECPI Global ESG Hydrogen Economy UCITS ETF (HYDRO FP) and BNP Paribas Easy ECPI Global ESG Med Tech UCITS ETF (MEDTE FP) provide thematic equity exposure to companies involved in the hydrogen economy and medical technology industries, respectively.
The BNP Paribas Easy FTSE EPRA/NAREIT Global Developed Green CTB UCITS ETF (GRCTB FP), meanwhile, offers exposure to the most environmentally friendly REITS and real estate companies listed in developed markets globally.
Hydrogen economy
The BNP Paribas Easy ECPI Global ESG Hydrogen Economy UCITS ETF tracks the ECPI Global ESG Hydrogen Economy Index which selects its constituents from a universe of developed market stocks with market capitalizations above €500 million and average daily trading volumes greater than €5m.
The methodology first removes violators of UN Global Compact principles, firms with very low ESG ratings, and companies with business operations linked to tobacco, controversial weapons, conventional weapons, oil & gas, thermal coal, and coal-based electricity generation.
The index then screens for companies that can be classified within two industry categories: ‘Hydrogen Products’ and ‘Clean Energy’.
Companies within the Hydrogen Products category are defined as firms involved primarily in hydrogen projects including hydrogen producers, fuel cell manufacturers, or companies in the electrolysis sector.
Clean Energy companies, meanwhile, comprise renewable energy producers with marginal exposure to hydrogen production plants.
The index targets 40 constituents, selecting the 30 largest stocks from the Hydrogen Products category and 10 largest from the Clean Energy category. Constituents are equally weighted, and the index is reviewed on a semi-annual basis with buffer rules helping to limit unnecessary turnover.
The ETF comes with an expense ratio of 0.30%.
Medical Technology
The BNP Paribas Easy ECPI Global ESG Med Tech UCITS ETF tracks the ECPI Global ESG Medical Tech Index which follows a similar process as described above for the hydrogen economy index.
The methodology builds an eligible universe of stocks by screening for companies classified within four industry categories: ‘Biotechnology’, comprising companies active in genomic science activities; ‘Life Sciences Tools & Services’, comprising companies involved in drug discovery and development through the provision of analytical tools and services; ‘Health Care Equipment & Suppliers’, comprising manufacturers of medical instruments, drug delivery systems, diagnostic equipment, and hospital supplies; and ‘Health Care Technology’, comprising companies active in telemedicine, digital health, robotics & AI-based solutions, administrative digitization, sensors, and wearable technologies.
The index targets 50 constituents with an equal split between US-listed and non-US-listed stocks. The methodology selects the largest companies while aiming to include a proportional number of constituents from each industry category that is representative of the total number of stocks from that category in the eligible universe. Constituents are also equally weighted.
The ETF also comes with an expense ratio of 0.30%.
Sustainable real estate
The BNP Paribas Easy FTSE EPRA/NAREIT Global Developed Green CTB UCITS ETF tracks the FTSE EPRA Nareit Developed Green EU CTB Index which covers developed market REITs and real estate companies while aiming to deliver notable improvements in climate and sustainable characteristics and minimising tracking error relative to the parent FTSE EPRA Nareit Developed Index.
To achieve this objective, the parent index is first screened to remove violators of UN Global Compact principles. The remaining constituents are then assessed on two sustainability considerations: estimated energy usage per square metre and floor space covered by eligible green certification.
These assessments are then applied as tilts to adjust company weights to provide greater exposure to those securities with real estate investment portfolios and operations demonstrating stronger sustainability performance.
To assess the sustainability performance of the constituents, the index draws on building-by-building geolocation data mapping from specialist data provider GeoPhy. This data is then matched with green certification data and provides the basis for detailed energy use and carbon emissions modelling.
The ETF comes with an expense ratio of 0.40%.
The fund serves as a complement to the BNP Paribas Easy FTSE EPRA/NAREIT Developed Europe ex UK Green UCITS ETF (GREAL FP) which launched in November 2019 and has since accumulated €400m in assets. This fund delivers the same strategy while targeting REITs and real estate companies listed in developed European markets excluding the UK. Its expense ratio is also 0.40%.