XTrackers MSCI EMU ESG UCITS ETF

Issuer: Xtrackers

Asset Class: Equity

TER: 20bps

Trading Currency: GBP

Pays Income: False

Listing Date: 28 Jan 2021

Ticker: XZEZ

ISIN: IE00BNC1G699

This fund offers a targeted approach to responsible investing within the European Monetary Union (EMU), providing exposure to large and mid-capitalization companies that demonstrate superior Environmental, Social, and Governance (ESG) performance relative to their sector peers. The investment strategy is built upon a 'best-in-class' selection process, meaning it identifies and includes companies with the highest MSCI ESG Ratings from each sector. This ensures a diversified portfolio across various industries while tilting towards firms that are better positioned to manage ESG-related risks and opportunities, which many believe can be a driver of long-term sustainable returns.

The underlying index applies a series of values-based exclusions, systematically removing companies involved in controversial business areas such as controversial weapons, tobacco, thermal coal, and oil sands. This screening process aligns the investment with the principles of socially responsible investing. By concentrating on the Eurozone, the fund provides access to a large, integrated, and mature economic bloc, home to many of the world’s leading multinational corporations. This geographic focus, combined with the ESG overlay, offers investors a way to participate in the growth of established European markets while adhering to sustainability criteria.

As an accumulating share class, any dividends distributed by the constituent companies are automatically reinvested back into the fund rather than being paid out to shareholders. This feature facilitates the compounding of returns over the long term, making it an efficient, low-maintenance option for investors seeking to build capital by backing Europe's corporate sustainability leaders.