Franklin Templeton has become the second issuer in Europe this week to launch a metaverse ETF.
The Franklin Metaverse UCITS ETF (FLRA) will list on Deutsche Boerse on 7 September and the London Stock Exchange and Borsa Italiana on 9 September with a total expense ratio (TER) of 0.30%.
FLRA will track the Solactive Global Metaverse Innovation Net Total Return index which offers exposure to companies that have “significant exposure” to the metaverse and supporting blockchain technologies.
The index currently holds 60 constituents with the top five holdings comprising of Apple (5.1%), Paypal (4.4%), Alphabet (4.4%), Meta Platforms (4.2%) and Microsoft (4.1%).
Dina Ting, head of global index portfolio management at Franklin Templeton, said: “Many big tech companies have already pivoted towards the metaverse for their next major area of development in the same way that many did at the inception of the internet.
“There appear to be tremendous real-world business opportunities for investment in this space considering that by 2032, the eCommerce market could grow between $2trn to $2.6trn.”
FLRA will also exclude companies that do not align with the United Nations Global Compact Principles.
Caroline Baron (pictured), head of ETF business development at Franklin Templeton, added: “We are delighted to be an early mover in this space and therefore provide European investors with access to a pool of cutting-edge companies across the key metaverse segments.
“FLRA allows investors to diversify their core holdings and satellite thematic sleeves in their existing portfolios and participate in the expected secular growth of the underlying megatrend that is digitisation.”
It comes after Fidelity International launched five thematic ETFs earlier this week including the Fidelity Metaverse UCITS ETF (FMTV).
ETC Group partnered with HANetf to launch Europe’s first metaverse ETF in March, the ETC Group Global Metaverse UCITS ETF (METP), which tracks the Solactive ETC Group Global Metaverse index. Roundhill Investments also launched a metaverse ETF in March, the Roundhill Ball Metaverse UCITS ETF (METV) which carries a TER of 0.59%.
FLRA undercuts METP in terms of price, which has a TER of 0.65%. Fidelity’s FMTV tracks an inhouse index and has a TER of 0.50%.