Due to the ESG criteria, the funds exclude certain industries, including those associated with alcohol, tobacco, military weapons, firearms, nuclear power and gambling, among others.
Additionally, Nuveen has launched the first-ever aggregate bond ESG-related ETF out there. The NuShares Enhanced Yield U.S. Aggregate Bond ETF (NYSEArca: NUAG) may be seen as an ETF alternative to the benchmark Barclays U.S. Aggregate Bond Index. NUAG seeks to offer enhanced yield relative to the broad, investment-grade fixed income market with comparable risk and credit quality.
“So what we’ve done is we’ve taken the Bloomberg Barclays Agg as it is now, and we’ve essentially taken out all companies that score less than triple-B on an ESG score from MSCI and so what you’ve ended up with is something that has the same risk characteristics as the Agg but it’s been filtered and scored according to ESG principles,” Kremenstein added.
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