Rize ETF has launched Europe’s first ETF targeting the pet care industry and another capturing emerging market internet and eCommerce sectors.
The Rize Pet Care UCITS ETF (PETZ) and the Rize Emerging Markets and Ecommerce UCITS ETF (EMRJ) are listed on the London Stock Exchange and Deutsche Boerse with total expense ratios (TERs) of 0.45% and 0.55%, respectively.
The two ETFs will list on the Borsa Italiana and SIX Swiss Exchange in due course.
PETZ physically replicates the Foxberry Pet Care index of 29 companies involved pet food and consumables, pet retail goods and services, pet health, pet insurance and veterinary services and equipment.
Only companies deriving at least 20% of their revenues from the target theme, with a market cap of at least $750m and daily trading volumes exceeding $2m are selected for inclusion.
Pet ownership is expected to grow 14% over the next 10 years, with research from Morgan Stanley forecasting household spending per pet will rise from $980 in 2020 to $1,909 in 2030.
Rahul Bhushan (pictured), co-founder and director at Rize ETF, commented: “Many single-person households, unmarried and childless families are increasingly adopting pets and the growth of our ageing population has also led to a greater number of furry companions.
“With the rise of work from home, pet adoption has suddenly become a lot easier, and people are making long-term commitments to their pets. For pet care companies, this has meant big business.”
EMRJ tracks the Foxberry Emerging Market Internet & Ecommerce index of 57 companies involved in digital commerce and online marketplaces, on-demand food, ride-hailing, social commerce, online travel, logistics and fulfilment, online search, digital advertisement digital media, video gaming and entertainment.
Like PETZ, EMRJ’s index only captures companies deriving at least 20% of their revenues from its desired theme. Companies must also have a minimum market cap of $500m, a daily trading volume above $2m. Weightings to each emerging market are also capped at 25% on index rebalance days.
Stuart Forbes, co-founder and director at Rize ETF, said: “In the years ahead, we are looking at two converging but mutually reinforcing megatrends: the internet as an incubator for technological innovation and ecommerce as a catalyst for behavioural change.
“Our ETF does two things. Firstly, it integrates our standard ESG screening to avoid exposure to the bad corporate citizens. And secondly, it limits any single country exposure to 25% – ensuring the strategy never defaults to a proxy China fund – something that continues to plague many emerging market funds.”
The two products are the latest additions to its thematic ETF roster following the launch of the Rize Digital Payments Economy UCITS ETF (PMNT) last November.