Europe’s first specialist thematic ETF issuer Rize ETF has unveiled its first two ETFs offering exposure to cybersecurity and medical cannabis.
The Rize Cybersecurity and Data Privacy UCITS ETF (CYBR) is listed on the London Stock Exchange and Xetra with a total expense ratio (TER) of 0.45% while the Rize Medical Cannabis and Life Sciences UCITS ETF (FLWR) is listed on Xetra and will list on the LSE later this week with a TER of 0.65%.
Both ETFs have been launched in collaboration with index provider Foxberry and thematic specialists in each particular theme.
Working with cybersecurity specialist Tematica Research, CYBR tracks the Foxberry Tematica Research Cybersecurity & Data Privacy index.
CYBR offers exposure to 45 companies that are set to benefit from the rise in cybersecurity products and services.
These businesses offer protection against cyber threats and are pushing for better data privacy regulation across the globe.
The firm said the key differentiator with CYBR is the exclusion of companies engaged in the aerospace and defence sector.
Stuart Forbes, co-founder of Rize ETF, commented: “We want to give much greater consideration to the growing concern amongst investors around particular topics such as social and environmental issues and human conflict and, in each case, seeking to incorporate some of the most directly applicable considerations into the structure of each product.”
Rahul Bhushan (pictured), co-founder of Rize ETF, added: “The cybersecurity market is entering into a new phase of growth, as technologies such as AI and the cloud rapidly change security practices and digital infrastructures around the world, and as the sector is buoyed by favourable regulation such as GDPR in Europe and CCPA in the US.”
Working with medical cannabis specialist New Frontier Data, FLWR tracks the Foxberry Medical Cannabis & Life Sciences index.
FLWR provides exposure to 23 companies that are exposed to the revolution in cannabinoid-derived medicine and wellness products.
It is Europe’s second medical cannabis ETF after Purpose Investments partnered with HANetf to launch the Medical Cannabis and Wellness UCITS ETF (CBSX) at the start of the year.
FLWR operates an exclusion list for companies that are non-compliant with state and federal laws, ineligible for investment from any person or involved in the production or distribution of cannabis flower for the recreational consumer market.
The ETF also offers exposure to companies operating in Australia, Israel, China, Colombia, Switzerland and the UK, as well as the US and Canada.
FLWR incorporates companies from the ‘Big Pharma’ sector that are involved through the development or acquisition of patents, distribution partnerships and sponsored clinical trials, although exposure to this sector is capped at 10% of the index.
Bhushan said: “The medical cannabis market continues to grow, buoyed by the tailwinds of favourable legislation, social acceptance, medical recognition and an exciting CBD complex, at a rate only eclipsed in the last century by internet adoption.”
The launches come two weeks after the announcement former Legal & General Investment Management (LGIM) colleagues had left to set-up their own issuer, Rize ETF.
Rize ETF was founded by Bhushan, Forbes, Anthony Martin and Jason Kennard all who worked together at ETF Securities and subsequently LGIM following its acquisition of the Canvas platform in 2018.