HSBC MSCI Emerging Markets Climate Paris Aligned UCITS ETF Acc USD

Issuer: HSBC

Asset Class: Equity

TER: 18bps

Trading Currency: GBP

Pays Income: False

Listing Date: 08 Apr 2022

Ticker: HPEF

ISIN: IE000FNVOB27

This fund offers exposure to a broad basket of large and mid-cap stocks across various emerging market countries. Its core objective is to replicate the performance of a specific benchmark designed to align with the Paris Agreement goals. This means it doesn't just invest in emerging markets but does so with a strong environmental focus, specifically targeting a significant reduction in greenhouse gas emissions compared to a standard market-cap-weighted emerging markets index.

The methodology involves selecting companies that are on a clear decarbonization path. It overweights companies with lower carbon intensity and those generating green revenues, while systematically underweighting or excluding companies involved in fossil fuels or those with high carbon emissions. This approach not only aims to mitigate climate-related transition risks but also to capture opportunities in the growing green economy within developing nations. The fund utilizes a physical replication strategy, meaning it holds the underlying stocks of the index directly.

This investment is suitable for those looking to combine the long-term growth potential of emerging economies with a robust climate-conscious investment strategy. It allows investors to participate in the economic development of these regions while ensuring their capital supports the global transition to a low-carbon economy. By adhering to the stringent EU Paris-Aligned Benchmark (PAB) criteria, the fund provides a transparent and standardized way to build a portfolio that is both forward-looking in its geographic allocation and responsible in its environmental impact.