L&G Energy Transition Commodities UCITS ETF (Acc)

Issuer: L&G ETFs

Asset Class: Commodity

TER: 65bps

Trading Currency: GBX

Pays Income: False

Listing Date: 17 Apr 2024

Ticker: ETRA

ISIN: IE000BLN64M9

This instrument provides targeted exposure to a basket of commodities that are integral to the global transition towards a more sustainable, low-carbon economy. The investment strategy is centered on the raw materials essential for the development and deployment of new energy technologies. This includes industrial and precious metals crucial for electric vehicle batteries, charging infrastructure, wind turbines, solar panels, and the broader electrification of the global energy grid. By focusing on the building blocks of the green revolution, it offers a direct play on the increasing demand for these finite resources as the world moves away from traditional fossil fuels.

The investment case is underpinned by powerful, long-term secular trends. Governments worldwide are implementing ambitious climate policies and providing substantial subsidies to accelerate decarbonization efforts, creating a durable demand pipeline for these 'new energy' commodities. Concurrently, technological advancements are making renewable energy and electric vehicles more cost-competitive and widely adopted by consumers and industries alike. This fund allows investors to capitalize on the physical supply-and-demand dynamics of these critical materials, which may offer a different risk-return profile compared to investing in the equity of clean energy companies. It provides a unique way to participate in the structural shift towards clean energy, potentially benefiting from supply constraints and rising prices as the transition gathers momentum. As a thematic commodity investment, it can serve as a strategic satellite holding in a diversified portfolio, offering both growth potential tied to a significant global megatrend and a potential hedge against inflation.