With a greater understanding of environmental, social, and governance (ESG) investing, environmentally-conscious investors today are getting pickier about the investments they are getting into.
Now, investors have another choice when it comes to investing in companies that go the extra mile for the environment. Listed on 28 September 2022, CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF (SGX: LCU/LCS) joins the Lion-OCBC Securities Singapore Low Carbon ETF (SGX: ESG/ESU) that was listed earlier this year.
As its name suggests, CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF invests in companies with low carbon exposure in Asia Pacific markets.
With that, we look at some things that investors should note if you are considering the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF.
What Is The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF?
The aim of CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF is to replicate the performance of the FTSE Asia Pacific Low Carbon Select Index.
The FTSE Asia Pacific Low Carbon Select Index is designed to reflect the performance of large- and mid-cap stocks in Asia Pacific markets, and takes into account ESG factors in its index design. The index constituents’ weights are adjusted based on the operational carbon emission intensity and fossil fuel reserve intensity performance of the companies.
Using a representative sampling strategy, the ETF will invest in a representative sample of a portfolio of securities selected by the manager using quantitative analytical models. As such, it may hold securities that are not constituents of the index.
The ETF offers dual currency trading in both the US dollars (ticker: LCU), which will be the primary currency, and Singapore dollars (ticker: LCS). The board lot size for the ETF is 1 unit.
What Are The Top 10 Holdings Of The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF?
The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF currently consists of just over 170 companies.
Some of the more well-known stocks that are part of the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF include Taiwan Semiconductor Mfg Co Ltd (NYSE: TSM), Toyota Motor Corp (TYO: 7203), and Alibaba Group Holding Ltd (HKG: 9988).
As of 29 September 2022, here’s a list of the top 10 stocks that are part of the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF.
Read Also: What Is An ADR? How Singapore Investors Can Use It To Buy Global Companies Listed In The US
The FTSE Asia Pacific Low Carbon Select Index is reviewed annually in September to screen for the eligibility of the respective companies, and to assign an index weight to each index constituent.
Any changes during the review will be reflected in the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF as well.
What’s The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF’s Expense Ratio?
The expense ratio represents an investor’s annual cost of holding the ETF. In other words, it’s an ongoing expense that investors have to pay the ETF managers to operate the ETF. The ETF managers themselves will use this to pay for costs they incur, such as administrative, legal and other operating expenses to run the ETF.
According to the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF website, since the ETF is newly set-up, the ongoing charges over a year is estimated to be 0.86%. It also said that the figure might be different upon actual operation.
For investors, the ETF’s expense ratio is a recurring annual cost that is above the brokerage commissions and fees they have to pay when buying the investment.
How To Buy The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF?
Investors who wish to invest in the ETF can do so via their stock brokers, just like how they go about buying regular stocks for their portfolio.
The US dollar version of the ETF is currently priced at US$0.98, while the Singapore dollar version is selling at S$1.41.
The CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF is also classified as Excluded Investment Product (EIP). This means that investors do not have to specifically qualify to trade it, unlike a Specified Investment Product (SIP) such as the Daily Leverage Certificates (DLCs).
Investors are encouraged to understand the risks involved before buying the CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF by reading through its prospectus.
Read Also: [2022 Edition] Complete Guide To ETF investing in Singapore
The post CSOP CGS-CIMB FTSE Asia Pacific Low Carbon Index ETF (LCU/LCS): Another Way To Do “Good” For Your Portfolio appeared first on DollarsAndSense.sg.
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