Bringing you live news and features since 2006 

Energy rebrand from VanEck reflects evolving sector

RELATED TOPICS​

Over 10 years since its launch, VanEck’s alternative energy ETF has received a rebrand to reflect the changing nature of the sector as driven by investors looking for low carbon investment opportunities.

Brandon Rakszawski, Senior ETF Product Manager, VanEck, explains that the VanEck Vectors Global Alternative Energy ETF (GEX), launched in 2007, has become the VanEck Vectors Low Carbon Energy ETF with the new ticker SMOG.

“It’s had quite a history,” Rakszawski says. “It’s an interesting area and clean alternative energy has been prevalent in the investment space for some time. This ETF goes back to the early ETF development phase as investors began seeking liquid, diversified exposure to the industry.”

VanEck believes that the fund’s new name better reflects the ways in which investors are driving change in the energy space, particularly as they search for low carbon investments.
“Attention has come and gone in the sector,” Rakszawski says. “There have been various energy environments over the ETF’s lifetime, with fossil fuel prices fluctuating significantly over the decade. Now it’s time to raise more awareness from the investing community.”

The ETF has USD95 million in assets, and its index, the Ardour Global Index Extra Liquid, will remain unchanged and will continue to focus on companies involved in the production of power through environmentally friendly, non-traditional sources such as wind, solar, hydro, geothermal and bio-fuels as well as the related technologies used to support the production of this power and increase efficiencies in its production, transportation and storage.

“This an area where investors have been interested to some level for over a decade,” Rakszawski says, observing that when the ETF listed oil was approaching USD100 a barrel but new technological advancements in the energy sector has caused supply to increase and prices to come down.

“There are a lot of dynamics at play here,” he says. “There has been such a focus on the climate in recent years with the 2016 Paris Agreement and other major initiatives by corporations and local governments which bring more attention to the space, not just from a political perspective but also an investment perspective.”

Rakszawski comments that the ETF industry has equally evolved and within that the focus on alternative energy has shifted to green, renewable descriptors and a heavy focus on carbon. The rebrand is designed to better align with what has become the industry’s vernacular, he says.

With under USD100 million in assets, this ETF is not currently courting major institutional investors. “But while it is listed in the US, we do business globally and focus on sustainable themes globally is arguably more prevalent outside the US,” he says. “Interest in ESG initiatives comes from the individual investor and the financial adviser community.”
 

Latest News

Morningstar has published a review of the European ETF market for the first quarter 2024, which finds that it gathered..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Kristen Mierzwa, FTSE Russell
Index Investments Group (IIG), a division within index provider FTSE Russell, has extended its range of indices through two new...
ETFs
US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles...
Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by