Invesco GBP Corporate Bond ESG UCITS ETF Dist

Issuer: Invesco

Asset Class: Fixed Income

TER: 10bps

Trading Currency: GBX

Pays Income: False

Listing Date: 26 Feb 2020

Ticker: IGBE

ISIN: IE00BKW9SV11

This investment vehicle offers targeted exposure to the sterling-denominated, investment-grade corporate bond market, with a sophisticated overlay of environmental, social, and governance (ESG) principles. The fund is constructed to align with the Paris Agreement's climate goals, meaning it actively seeks to reduce carbon emissions intensity compared to the broader market. It achieves this by applying specific ESG screens and a tilting methodology that favors companies with stronger sustainability profiles and lower climate risk. The investment process excludes companies involved in controversial weapons, tobacco, and thermal coal, while also underweighting or removing those that fail to meet climate transition criteria. This results in a portfolio of corporate debt from issuers who are better positioned for a low-carbon future.

Beyond its strong ESG credentials, the fund employs a multifactor approach to security selection, aiming to enhance risk-adjusted returns. It systematically targets bonds with attractive characteristics related to value, quality, and low volatility. This quantitative strategy seeks to outperform traditional market-cap-weighted bond indices over the long term by capturing proven risk premia within the corporate bond space. For investors, this provides a dual benefit: the potential for enhanced returns and a robust, forward-looking approach to managing climate risk in a fixed-income portfolio. The fund is designed for those looking for a core holding that provides regular income through semi-annual distributions while adhering to a rigorous sustainable investing framework.