In Focus: Megatrends  

Are names, labels and ratings enough when it comes to ESG selection?

  • Learn how to pick an ESG ETF
  • Understand the different ways of filtering for ESG
  • Learn how to use ESG ETFs as part of a portfolio
CPD
Approx.30min
Mega-trends
Investing in the growth story of the future
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The number of environmental, social and governance or sustainability focused ETFs has grown dramatically in the past two years, making it difficult to chose the right one. But there is a way.

In 2019, only 10 per cent of flows into European ETFs were into funds with ESG or sustainability characteristics, but by 2021 that percentage had grown to more than 50 per cent – a dramatic change.

The number of ESG-focused ETFs has also more than doubled, according to Morningstar, with more than 900 available globally in early 2022 compared to around 370 at the end of 2019.

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And while choice is good, especially in a market where investors have a range of values and priorities, we are then presented with the challenge of how to choose.

This 30-minute CPD is the final instalment of the FTAdviser In Focus content hub Mega-trends, in partnership with Wisdom Tree.

This report reviews the dominant ideas and concerns expressed throughout the Mega-trends hub, highlighting key themes such as how advisers and their clients can invest in growth stories around 5G technology and cybersecurity, as well as green energy, geopolitical shifts and the digital universe – identified by Wisdom Tree as the trends that will shape the future of the world we live in.

Please answer the following six questions to bank your CPD.

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. Why are specialist climate funds best used as satellite allocations, according to the author?

  2. Which new solution helps investors reallocate capital towards a low carbon economy and align with the Paris climate goals?

  3. Why should advisers check the detailed rules of an index?

  4. ESG ETFs are long-term investments, according to the author. True or false?

  5. Index rules tell advisers how often ESG data and holdings are refreshed. True or false?

  6. Index rules are generally less precise than active funds' investment policies, according to the author. True or false?

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You should now know…

  • Learn how to pick an ESG ETF
  • Understand the different ways of filtering for ESG
  • Learn how to use ESG ETFs as part of a portfolio

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