KraneShares announced in a press release today the launch of its newest fund, the KraneShares Global Carbon Transformation ETF (KGHG). The fund will be actively managed by award-winning portfolio manager Roger Mortimer and seeks to capture the low-carbon leaders of tomorrow.
KGHG will invest in companies from some of the highest-emitting industries that are focused on energy transition and carbon reduction. These particular companies, which have provided stated commitments to carbon reduction and followed through with clear actions towards those goals, could be positioning to outperform in their industries in the long term with improving ESG scores and revaluations.
“The climate crisis remains one of the most significant long-term challenges facing the global community. Investing in companies with the commitment to change and lead – not just the cleanest companies today —may be one the most impactful ways to rebuild a greener, more resilient economy,” explained Luke Oliver, managing director and head of investment strategy at KraneShares, in the press release.
Roger Mortimer has a well-established and recognized background in banking, utilities, and the investment industry and has been a public global equities portfolio manager for more than 20 years. Mortimer has been 5 Star Morningstar rated for three separate mandates as well as many notable accolades and media features for his strategies. His passion and focus on the climate transition today, alongside his extensive experience, make him an excellent fit for this next venture from KraneShares.
“The recent tragic events in Ukraine have brought the risk of energy dependency into sharp focus. We expect that the critically strategic nature of Europe’s energy crisis will result in accelerated policy implementation and capital spending in energy transition and resiliency,” said Mortimer in the press release. “These geopolitical concerns coupled with urgent climate objectives are increasing the awareness of the value of energy transition. KGHG will invest in companies around the world that are seeking to lead the race to decarbonize.”
KGHG invests in companies that are currently reducing their carbon emissions or are reducing the carbon footprints of other companies across market cap and sectors all around the world. The fund provides diversification opportunities for a portfolio, both in its global scope as well as the potential for non-correlated returns to the economic cycle. The fund is not impacted by taxes from capital gains at portfolio rebalance, offering investors tax efficiency in addition to diversification.
“We have committed to make climate a major part of the KraneShares brand and I am leading this initiative,” Oliver wrote to ETF Trends. “We manage $1.4bn in carbon assets that will now be complimented with decarbonization equities and will be further followed by additional ETFs that target the global energy transition.”
KGHG carries an expense ratio of 0.89% and joins the KraneShares climate suite of funds that includes the KraneShares Global Carbon Strategy ETF (KRBN), the KraneShares European Carbon Allowance Strategy ETF (KEUA), and the KraneShares California Carbon Allowance Strategy ETF (KCCA).
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