iClima, a female-led, green fintech firm focused on redefining climate change investments, has announced the launch of its first set of US-listed ETFs today: the iClima Global Decarbonization Transition Leaders ETF (NYSE: CLMA) and the iClima Distributed Renewable Energy Transition Leaders ETF (NYSE: SHFT). Both ETFs provide investors with exposure to the next generation of companies leading the fight against climate change.
The competition is still stuck on the mantra ‘do less harm’, while iClima is firmly rooted in promoting ways to ‘do more good’. iClima writes that unlike its competitors who often use ESG scorecards, iClima focuses on a tangible metric, Gigatons of Potential Avoided Emissions in terms of CO2e per year. Both CLMA and SHFT are based on a robust methodology that quantifies the CO2e impact by calculating the potential emissions avoided for each equity holding and for their underlying index as a whole.
Designed to be a core holding, CLMA holds stocks that don’t just reduce their own carbon footprint, instead, they actually generate revenue from providing climate change solutions. The fund captures the following sectors: green energy, green transportation, water & waste improvements, decarbonization enabling solutions and sustainable products.
SHFT is a focused one-ticker solution to a far-reaching problem. Simply put, SHFT offers exposure to the green solutions that are updating and ultimately replacing our inefficient, outdated energy grid. Designed to be a satellite holding within a diversified portfolio, SHFT spans three key pillars: decentralization of the power sector, digitalisation of energy solutions and decarbonizing of energy sources, including residential solar panels, energy storage, smart meters, vehicle-to-grid energy (‘V2G’), electric vehicle charging, smart inverters, and software solutions that leverage Artificial Intelligence (AI) to manage the system.
“These two funds are a practical way for investors to join the next wave of companies leading the green transition,” says Gabriela Herculano, iClima co-founder and CEO. “The next generation of climate change investment does not revolve only around emissions reduction, instead, it’s laser focused on the leading companies that provide products and services that enable emissions avoidance altogether. CLMA and SHFT will appeal to investors who have a strong interest in sustainability themes and early adopters who are seeking more impactful portfolio exposure to technology-forward solutions in the ongoing fight against climate change.”
CLMA and SHFT are unique amongst their competition due to their systematic negative screening based on estimated green and brown revenue, ensuring that companies are progressing based on climate change principles.
“While the sheer number of competitors in this space is high and only rising, the reality is that no one out there provides this comprehensive of an investment solution to a problem as massive and alarming as global warming,” says Shaila Khan Leekha, iClima co-founder and COO.
Each fund’s expense ratio is 0.65 basis points. CLMA will hold 157 constituents and SHFT will hold 50. Both funds are expected to rebalance semi-annually.