XTrackers ESG USD Corporate Bond UCITS ETF 1C

Issuer: Xtrackers

Asset Class: Fixed Income

TER: 16bps

Trading Currency: USD

Pays Income: False

Listing Date: 10 Sep 2020

Ticker: XZBD

ISIN: IE00BL58LJ19

This fund offers a targeted approach to fixed-income investing, combining exposure to the global U.S. dollar-denominated corporate bond market with a robust sustainability framework. It is designed for investors seeking to generate income and capital appreciation from investment-grade corporate debt while simultaneously ensuring their capital is allocated in line with stringent ethical and environmental standards. The underlying portfolio consists of bonds issued by companies that demonstrate strong performance on environmental, social, and governance (ESG) metrics, providing a way to access the stability of corporate credit from responsible issuers worldwide.

The investment strategy is distinguished by its dual ESG criteria: Socially Responsible Investing (SRI) and alignment with the Paris Agreement. The SRI component involves negative screening to exclude companies with significant business activities in controversial sectors such as weapons, tobacco, and thermal coal. Furthermore, the fund adheres to the EU's Paris-Aligned Benchmark (PAB) regulations, meaning the portfolio is constructed to achieve at least a 50% reduction in greenhouse gas intensity compared to the parent universe and follows a self-decarbonization trajectory of at least 7% annually. This makes the fund particularly suitable for those who prioritize sustainability and wish to support the transition to a low-carbon economy. It can serve as a core fixed-income holding, offering diversified exposure to high-quality corporate bonds while helping to mitigate climate-related transition risks.