Solactive Delivers New Green Bond Index for Lyxor Asset Management to Enable Asset Owners to Invest in Corporate Green Bonds
- Trading Systems , Investment
- 14.09.2021 04:00 pm
The Green Bonds market is slightly over a decade old, and its growth has gained pace recently. Compared to 2019, the Green Bonds market increased by USD 290bn in 2020, which represents a 9% increase in new issuances, according to a report by the Climate Bonds Initiative (CBI). Solactive is pleased to announce that Lyxor Asset Management launched its Lyxor Corporate Green Bond (DR) UCITS ETF tracking the Solactive EUR USD IG Corporate Green Bond TR Index. The ETF enables investors to align their corporate bond portfolio with net-zero goals by adding corporate bonds to their portfolio that contribute to the transition to a low-carbon economy. The ETF started trading on Xetra, London Stock Exchange, and Borsa Italiana.
According to CBI, corporates make up more than half of all new green bond issuances in 2021 year-to-date, and along with a growing awareness in all politics, economy, and society, the green bond market is likely to grow in prominence even further. For companies dedicated to meet zero-emission targets, the green bond market depicts an effective way to secure dedicated funding for their investments necessary for far-reaching transitions. Solactive created an index including companies, which utilize the green bond market to reach their climate targets.
The Solactive EUR USD IG Corporate Green Bond TR Index is a rules-based, market value-weighted index engineered to mirror the investment grade corporate green bond market. Comprised of investment grade rated green bonds denominated in EUR and USD, the index is calculated as a Total Return Index denominated in EUR. Besides its green directionality, the index features an ESG screening filtering issuers for the following ESG criteria: Controversial Weapons; Civilian Firearms; Adult Entertainment; Alcohol; Gambling; Genetic Engineering; Stem Cell; Tobacco, Thermal Coal, UN Sanctions, and UNGC.
Timo Pfeiffer, Chief Markets Officer at Solactive, comments:“As we observed a clear upward trend in corporate green bond issuance during the last 24 months - and we expect this segment to grow further - it was about time to create an index for product providers for this niche. Lyxor Asset Management has been one of our main business partners in the realm of green bond investing from the start, and we cannot wait to intensify our projects going forward.”