Lyxor has launched three high yield ETFs with an environmental, social and governance (ESG) tilt,
Tracking the Bloomberg Barclays MSCI Sustainable SRI indices, the three ETFs will cover the USD high yield, EUR high yield and global high yield markets.
The indices were launched by Bloomberg and MSCI earlier this week as part of a nine-strong range offering exposure to the high yield ESG market.
Issuers must have a minimum MSCI ESG rating of BBB to be included in the ETFs while any company materially involved in controversial industries will be screened out of the indices.
The Lyxor USD High Yield Sustainable Exposure UCITS ETF (UHYS) and the Lyxor Global High Yield Sustainable Exposure UCITS ETF are listed in US dollars on the London Stock Exchange with a total expense ratio (TER) of 0.25%.
All three ETFs will be listed in euros on the Borsa Italiana on 25 February.
Philippe Baché (pictured), head of fixed income at Lyxor ETF, commented: “ESG rating in high yield is one of the latest innovations in fixed income indexing.
“We are always looking for ways to provide investors with even more innovative tools to achieve their sustainable goals.
“By applying an ESG lens to the high yield bond universe, we are able to provide a significant move away from parent indices offering a potentially more conservative risk profile.”
Sanjay Rao, product manager at Bloomberg Barclays Indices Europe, added: “ESG investing has continued to grow and we will continue to evolve our offering to provide investors with a broad portfolio of ESG index solutions.”