VanEck has launched a circular economy thematic ETF investing in companies furthering efficient use of resources.
The VanEck Circular Economy UCITS ETF (REUS) is listed on the London Stock Exchange with a total exchange ratio (TER) of 0.40%.
REUS tracks the MVIS Global Circular Economy ESG index of 30 companies deriving at least 50% of their revenues from activities related to water purification and treatment, energy production from waste and biofuels, waste management and metal recycling, or products made from recycled or repurposed materials.
The index aims to capture at least 90% of the investable universe of companies, with constituents required to have a market cap of at least $150m and a three-month average daily trading volume of $1m.
REUS also excludes companies in violation of social norms, as well as those selling controversial weapons and surpassing certain revenue thresholds for civilian firearms and tobacco.
Each company is capped at 8% of the index, which is rebalanced quarterly.
Martijn Rozemuller, CEO of VanEck Europe, commented: “Our planet's resources are becoming increasingly stretched and the world is struggling with the waste generated by single-use products.
“By offering this ETF, we are responding to the current high level of interest in issues related to sustainable production and the environmental impact of our consumption.”
Kamil Sudiyarov, product manager, Europe, at VanEck, added: “The circular economy not only benefits the environment, it also offers economic opportunities.
“For example, recycling paper provides energy savings of up to 40% compared to producing paper from raw pulp.”
VanEck has continued to be active in rolling out its thematic range in 2022, launching the VanEck Genomics and Healthcare Innovators UCITS ETF (CURE) in September and the VanEck Space Innovators UCITS ETF (JEDI) and VanEck Sustainable Future of Food UCITS ETF (VEGI) in June.