USCF Advisers has launched an actively managed sustainable broad commodity ETF.
The USCF Sustainable Commodity Strategy Fund (ZSC), listed on NYSE Arca on August 9, seeks to provide broad exposure to commodities across three different sustainability focused themes: agriculture, renewable energy, and electrification.
ZSC will primarily invest in commodities derivatives as well as equity securities that are economically tied to specific commodities. The commodity ETF’s exposure to each of the three sustainability themes will be approximately equally weighted.
Under the Hood of USCF Advisers’ Sustainable Commodity ETF
The fund utilizes a proprietary multi-factor quantitative methodology to select the commodities investments in each theme. For each theme, the methodology considers factors including the primary use of a specific commodity, the secondary and potential other uses of such commodity, and each commodity’s environmental impact, according to regulatory filings.
ZSC invests in commodities derivatives when available, as commodities derivatives have the highest correlation to the prices of their underlying commodities, according to regulatory filings. In the case that commodities derivatives are not available to gain desired exposure, the fund advisor will invest in companies that are economically tied to such commodity.
ZSC may invest in both U.S. and international companies. This includes companies located in emerging markets, as well as in instruments denominated in both U.S. dollars and foreign currencies.
Furthermore, the fund invests in commodities derivatives primarily through a wholly owned Cayman Islands subsidiary.
ZSC seeks to achieve a “net-zero” carbon footprint. The fund purchases carbon offset investments in an amount equal to the estimated aggregate carbon emissions of the fund’s holdings.
The fund charges 59 basis points after a 39 basis point fee waiver.
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