DWS launches two ESG S&P 500 ETFs

ESG, ETFSDWS has stepped up the race to be Europe’s second-largest ETF issuer with the launch of a further two ESG strategies.

The Xtrackers S&P 500 ESG UCITS ETF and the Xtrackers S&P 500 Equal Weight ESG UCITS ETF are listed on the London Stock Exchange and the Deutsche Boerse.

These will track the S&P 500 ESG and S&P 500 ESG Equal Weight ESG indices, respectively.

Both will use an exclusion policy to filter out companies that exceed revenue thresholds linked to controversial weapons, tobacco and thermal coal.

Companies that fall short of international standards, such as the UN Global Compact Principles, will also be excluded.

In addition, these strategies will forego investing in companies within the bottom 25% of ESG Scores from each GICS Industry Group, as well as those without an S&P Dow Jones indices score.

It is estimated this will result in an investible universe of around 300 stocks.

Simon Klein, global head of passive sales at DWS, said: "The importance of ETFs that track the US equity market in conjunction with transparent ESG criteria in a portfolio has grown significantly in recent years.

“We are pleased to further expand our Xtrackers offering for investors with attractive solutions,” he added.

The double-launch comes amid a heightening contest among European asset managers to become the second-largest ETF issuer on the continent.

In January, Amundi’s acquisition of Lyxor saw it displace DWS in the second spot.

Reclaiming the position is a key target of the German asset manager’s ambitions for the coming years.

“DWS aims to grow its Xtrackers and passive business globally as the company expects ongoing strong growth of passive products, which can be highly profitable given sufficient scale. In Europe, DWS wants to regain its number two position for ETPs,” the firm said as part of its 2025 targets unveiling.

The new funds from DWS mirror Amundi’s S&P 500 Equal Weight ESG Leaders UCITS ETF, sharing an expense ratio of 0.17%.

At the end of Q3 2022, DWS had a 10.1% market share compared to Amundi’s 12.6% stake, according to Morningstar data.

© 2022 funds europe

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