Impact investing platform Circa5000 is set to enter the European ETF market in June with a five-strong suite of thematic strategies, ETF Stream can reveal.
The ETFs will list on the London Stock Exchange with a total expense ratio (TER) of 0.49% and will be available through UK investment platforms and model portfolios.
The ETFs are:
CIRCA5000 Clean Water & Waste UCITS ETF (C5KW)
CIRCA5000 Green Energy & Technology UCITS ETF (C5KG)
CIRCA5000 Health & Wellbeing UCITS ETF (C5KH)
CIRCA5000 Social & Economic Empowerment UCITS ETF (C5KE)
CIRCA5000 Sustainable Food & Biodiversity UCITS ETF (C5KF)
The ETFs track indices built in-house in partnership with impak Analytics and BITA, offering exposure to the most impactful companies, those with the best governance and those doing the most to mitigate their negative externalities for each underlying theme.
Circa5000 added it examines quantitative metrics when considering companies for index inclusion and constituent impact using the Impact Management Project’s five dimensions of assessing impact.
Rebalanced semi-annually and labelled Article 9 under the Sustainable Finance Disclosure Regulation (SFDR), the ETFs will apply a real-time controversies screen.
Tom McGillycuddy (pictured), co-founder of Circa5000, told ETF Stream: “We wanted to offer cost-effective impact investing, with active creation and passive implementation.
“With 30-page reports into each company, our products are in keeping with the best impact funds in the world but half the fee.”
While the initial ETF launches will be in the UK, McGillycuddy said the firm has received “a number of reverse enquiries” from France, Italy, Germany and Belgium.
“We decided to build our own ICAV rather than spin up an ETF using somebody else’s infrastructure. We are now dual-regulated for the UK and the EU.”
Charlie Macpherson, managing director of ETFs at Circa5000, added: “The ETFs invest in companies generating positive social and environmental benefits alongside positive long-term financial returns.
“We do not tweak existing strategies to tick regulatory boxes, our core strategy is impact investing. At the heart of our philosophy is the measurement and reporting of impact.”
McGillycuddy previously told ETF Stream the ETFs would look to offer direct voting rights to investors, with the initial concept being to crowd-source a voting stance on select issues from Circa5000 platform users.
He added once the five thematic products have launched, the firm would look to build green and impact fixed income ETFs.