Xtrackers Nordic Net Zero Pathway Paris Aligned UCITS ETF 1C

Issuer: Xtrackers

Asset Class: Equity

TER: 15bps

Trading Currency: GBP

Pays Income: False

Listing Date: 04 May 2023

Ticker: XNZN

ISIN: IE000HT7E0B1

This investment product offers exposure to a portfolio of large and mid-cap companies from Nordic countries, specifically Denmark, Finland, Norway, and Sweden. The strategy is designed to be compliant with the Paris Agreement goals, aiming for a significant reduction in carbon emissions. The underlying portfolio is constructed based on the EU's Paris-Aligned Benchmark (PAB) regulations. This means it follows a clear decarbonization trajectory, targeting a 50% reduction in greenhouse gas intensity compared to a standard market-cap-weighted universe and an average annual reduction of 7%.

This fund appeals to investors looking to align their portfolios with climate objectives while gaining targeted exposure to the robust and innovative Nordic economies. By investing in companies that are actively transitioning towards a low-carbon future, investors can potentially benefit from the long-term growth opportunities associated with sustainable business practices and technologies. The strategy also incorporates exclusion criteria, avoiding companies involved in controversial weapons, tobacco, and those that derive significant revenue from thermal coal or violate global norms, adding a layer of ethical screening.

This product can serve as a core holding for a European equity allocation, particularly for those with a strong conviction in the Nordic region's economic stability and leadership in sustainability. It can also function as a thematic satellite holding within a broader global equity portfolio, allowing investors to tilt towards climate-conscious investments. The fund's focus on decarbonization provides a specific tool for managing climate-related risks and capitalizing on the transition to a net-zero economy, making it a suitable choice for environmentally and socially responsible investors.