The Sustainable Exchange-Traded Universe Continues to Expand
Diversified offerings have grown more than 60% in the past 12 months.
When I took stock of the universe of sustainable exchange-traded products at this time last year--just ahead of the Morningstar ETF Conference--I noted the rapid increase in the number of diversified equity offerings pursuing sustainable investing, meaning they incorporate environmental, social, and corporate governance considerations in their investment processes. A year ago, 20 such funds existed, 17 of them having been launched in 2015 or in the first eight months of 2016. Together, they totaled $1.9 billion in assets.
Fast forward a year and we've seen an additional 13 launches (and one closure), bringing the total number of sustainable diversified equity ETPs to 32. Thirty of those are ETFs, and two are exchange-traded notes. As of July, their assets totaled $3.1 billion. I expect this universe to continue growing because of the confluence of interest in both sustainable investing and low-fee passive investing among institutional and retail investors.
Jon Hale does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.