VanEck Circular Economy UCITS ETF A USD Acc

Issuer: Van Eck

Asset Class: Equity

TER: 40bps

Trading Currency: GBP

Pays Income: False

Listing Date: 26 Oct 2022

Ticker: REUG

ISIN: IE0001J5A2T9

The traditional linear economic model, characterized by a 'take-make-dispose' approach, is facing increasing scrutiny due to its unsustainable consumption of finite resources and significant environmental impact. This system leads to massive waste generation and resource depletion, posing long-term risks to both ecosystems and economic stability. In response, the concept of a circular economy has emerged as a transformative alternative. This model aims to decouple economic growth from resource consumption by designing waste and pollution out of the system, keeping products and materials in use for as long as possible, and regenerating natural systems. It represents a fundamental shift towards a more resilient and sustainable industrial framework that emphasizes reuse, recycling, and remanufacturing.

This investment vehicle offers targeted exposure to the global pioneers driving the transition towards a circular economy. It invests in a portfolio of companies that generate a significant portion of their revenues from activities directly contributing to this new economic paradigm. These firms operate across various innovative sectors, including water purification and treatment, waste-to-energy solutions, recycling services, waste management, and the development of sustainable materials. By focusing on these enablers of circularity, the fund captures the growth potential of businesses that are not only addressing critical environmental challenges but are also well-positioned to benefit from tightening regulations and shifting consumer preferences towards sustainability.

Investing in the circular economy is a forward-looking strategy that aligns with powerful, long-term secular trends. As the global population grows and resource scarcity becomes more acute, the economic imperative for efficiency and waste reduction will intensify. Companies that are integral to this transition are likely to experience sustained demand and could potentially offer attractive long-term growth prospects. This fund provides a convenient and diversified way to participate in this structural shift, offering a stake in the innovative solutions that will shape a more sustainable and economically efficient future.