New Listing

JP Morgan AM unveils carbon transition China equity ETF

The asset manager’s second equity ETF linked to the Climate Transition Benchmark (CTB)

Theo Andrew

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JP Morgan Asset Management (JPMAM) has expanded its Climate Transition Benchmark (CTB) range with the launch of a China equity ETF.

The JPMorgan Carbon Transition China Equity (CTB) UCITS ETF (JCCT) is listed on the Deutsche Boerse, Borsa Italiana and the London Stock Exchange with a total expense ratio (TER) of 0.35%.

The ETF tracks the Solactive JP Morgan AM China Carbon Transition index which offers exposure to large and mid-cap companies listed in Hong Kong, Shanghai and Shenzhen.

The index is designed to capture companies that will benefit from the transition to a low-carbon economy while meeting the requirements for the European Union’s CTB.

In particular, the index will aim to achieve at least a 7% reduction on average of greenhouse gas emissions per annum and an overall reduction of at least 30% compared to the investible universe.

Stocks involved in ESG-controversial business areas or those associated with violations of the United Nations Global Compact initiative are excluded as well as companies involved in controversial weapons, thermal coal and tobacco.

JCCT is labelled Article 9 under the Sustainable Finance Disclosure Regulation (SFDR) and said it has at least 80% invested in sustainable investments as defined under SFDR.

Chinese tech firms dominate the ETF’s top holdings with Tencent (13%), Alibaba (8.6%), Meitun (4.6%) and (3.2%) all making it into the top five.

JPMAM declined to comment on the launch.

In September, JPMAM upgraded the JPMorgan Carbon Transition Global Equity UCITS ETF (JCPT) from Article 8 to Article 9 to reflect the ETF invests at least 80% of its assets in sustainable investments as defined under SFDR.

It is the firm’s third Article 9 ETF in the range alongside the JPMorgan Climate Change Solutions UCITS ETF (TEMP).

Franklin Templeton also runs a China equities climate ETF, the Franklin MSCI China Paris Aligned Climate UCITS ETF (CHPA), which has a TER of 0.22%.

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