Millennials may carry a low attention span stigma, but their focus on environmental, social and governance (ESG) investing seems to endure. The Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (EMSG) could benefit from millennials’ penchant for ESG investments.
While the pandemic has taken its toll on emerging markets (EM), ESG has certainly been an outperformer, even during the market sell-offs earlier this year. Combining both worlds together, the ESG component of EMSG almost acts like a buffer against the downside of EM.
EMSG seeks investment results that correspond generally to the performance, before fees and expenses, of the MSCI Emerging Markets ESG Leaders Index (the “underlying index”). The fund will invest at least 80% of its total assets (but typically far more) in component securities (including depositary receipts in respect of such securities) of the underlying index.
The underlying index is a capitalization weighted index that provides exposure to companies with high environmental, social and governance (“ESG”) performance relative to their sector peers. Per Morningstar numbers, the fund has generated a 16.8% return thus far this year:
Investors can get this EM and ESG exposure for an expense ratio of 0.20%, which ought to keep even the most cost-conscious happy.
“The millennial generation are behind a shift to increasing family allocations to sustainable assets, according to new research,” an Investment Week article said. “Barclays Private Bank’s Smarter Succession: The Challenges and Opportunities of Intergenerational Wealth Transfer research, found that 68% of older high net worth (HNW) individuals say that their children have been leading the family on sustainable and responsible investment matters.”
“The research, undertaken by global intelligence business Savanta which interviewed 402 high net worth families with at least £5m in assets each, revealed that four in five of all generations of high net worth family members said that responsible investing is important to them, with 81% of under 40s, 77% of 41 to 60-year-olds and 86% of over 60s agreeing,” the article added. “The research showed 11% of all generations said that having a positive environmental impact is a top personal aim and 37% “strongly agree” that responsible investing is now important to them. Barclays Private Bank said that changing attitudes have led to a substantial shift in the way HNW families are investing, with 78% expressing their views on social and environmental responsibility in their investments.”
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