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KEUA

KraneShares European Carbon Allowance Strategy ETF*

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Investment Strategy:

The KraneShares European Carbon Allowance Strategy ETF (KEUA) provides targeted exposure to the European Union Allowances (EUA) cap-and-trade carbon allowance program. KEUA is benchmarked to the IHS Markit Carbon EUA Index, which tracks the most traded EUA futures contracts. As a part of the KraneShares suite of carbon ETFs, KEUA provides a new vehicle for participating in the price of carbon and hedging risk while supporting responsible investing and ESG goals.

KEUA Features:

  • The EUA cap-and-trade program is the world's oldest and most liquid carbon allowance market. It covers approximately 40% of the EUs total emissions covering 27 EU Member States plus Iceland, Liechtenstein and Norway1.
  • The program targets reducing emissions by at least 55% of 1990 levels by 2030 and climate neutrality by 2050. The "Fit for 55" package released in 2021 set out an expansion and tightening of the program, including an increased cap reduction from 2.2% to 4.2% per year2.
  • EUA carbon allowances are among the fastest-growing, strongest performing, and diversifying asset classes. In 2021, EU carbon allowance futures have traded around $30 billion per month.3, 4
  • Can provide potential portfolio diversification due to the historically low correlation to traditional asset classes.1, 4

By pairing KEUA with other KraneShares carbon funds, investors can customize their allocation to the global carbon credit market:

*Formerly the KraneShares European Carbon Allowance ETF

1. IHS Markit, 12/31/2020.
2. Europe Commission, 7/14/2021
3. Data from Bloomberg as of 8/31/2021.
4. Diversification does not ensure a profit or guarantee against a loss.
5. California Air Resources Board, 2017.

Fund Details

Data as of 12/03/2021
TickerKEUA
Primary ExchangeNYSE
CUSIP500767561
ISINUS5007675615
Net Assets$4,482,328
Total Annual Fund Operating Expense 0.79%
Inception Date10/5/2021
Distribution FrequencyAnnual

Fund Documents

Daily Performance

Data as of 12/03/2021
Premium Discount Chart
NAV
Net Asset Value$89.64 
Daily Change -2.00%
Price
Market Price $90.29 
Daily Change-1.98%
30 Day Median Bid/Ask Spread
Value0.8%

The ETF’s 30 Day Median Bid-Ask Spread is calculated by identifying the ETF’s national best bid and national best offer ("NBBO") as of the end of each 10 second interval during each trading day of the last 30 calendar days and dividing the difference between each such bid and offer by the midpoint of the NBBO. The median of those values is identified and that value is expressed as a percentage rounded to the nearest hundredth.

Performance History

Distributions
Cumulative %
Data as of: 11/30/2021		 Fund NAV Closing Price Index
1 Month25.64% 26.30% –
3 Month– – –
6 Month– – –
Since Inception15.17% 15.91%
Cumulative %
Data as of quarter end: 09/30/2021		 Fund NAV Closing Price Index
Since Inception– – –
Growth of $10,000
Data as of 12/03/2021

The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when sold or redeemed, may be worth more or less than their original cost and current performance may be lower or higher than the performance quoted.

The Growth of $10,000 chart reflects an initial investment of $10,000 on the day prior to the selected time period and assumes reinvestment of dividends and capital gains. For the growth of $10,000 chart since inception, the initial investment of $10,000 is instead made on the inception date of the Fund. Fund expenses, including management fees and other expenses were deducted. The growth of a $10,000 investment in the fund is hypothetical and for illustration purposes only.

Carbon Allowance Futures

Data as of 12/03/2021
Name Identifier Position Current Exposure($) % NAV
European Union Allowance (EUA) 2022 Future MOZ22 Comdty 51 4,535,384 101.18%
4,535,384 101%

Collateral and Currency Management

Data as of 12/03/2021
Name Identifier Position Current Exposure($) % NAV
Euro FX Futures ECZ1 Curncy 26 3,676,888 82.03%
EURO EUR 746,298 841,829 18.78%
USD Cash & Equivalents** USD 798,876 798,876 17.82%
5,317,592 119%

Holdings, carbon allowance futures, and collateral are subject to change.
**Includes USD cash deposits & cash in margin accounts ($4,475,763), and implied short USD exposure from Euro FX futures

Top 10 Holdings

Data as of 12/03/2021
Full Holdings .CSV
Rank Name % of Net Assets Ticker Identifier Type Shares Held Market Value($) Notional Value($)
1 Cash 80.97% – – Cash 3,629,518 3,629,518 0
2 EURO 18.78% – – Currency 746,298 841,829 0
3 EURO 0.24% – – Currency 9,735 10,981 0
4 ECX EMISSION DEC22 0.00% MOZ22 – Future 51 0 4,524,027
5 EURO FX CURR FUT DEC21 0.00% ECZ1 – Future 26 0 3,676,888

Holdings are subject to change.

Related Content:

Topics

©2021 Krane Funds Advisors, LLC
280 Park Avenue, 32nd Floor, New York, NY 10017

Carefully consider the Funds’ investment objectives, risk factors, charges and expenses before investing. This and additional information can be found in the Funds’ full and summary prospectus, which may be obtained by visiting: KWEB, KBA, KURE, KFYP, KGRN, KALL, KBND, KHYB, OBOR, KARS, KEMQ, KMED, KEMX, KESG, KSTR, KFVG, KBUY, KRBN, KTEC, KEUA, KCCA, KGRO, KLCD, KSCD, IVOL, BNDD, KDFI, KVLE, KMLM, KUASX, KUAIX. Read the prospectus carefully before investing. Please note these links also contain the Funds' top ten holdings, performance, and other important information.

Risk Disclosures:

Investing involves risk, including possible loss of principal. There can be no assurance that a Fund will achieve its stated objectives. Indices are unmanaged and do not include the effect of fees. One cannot invest directly in an index.

This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This material is strictly for illustrative, educational, or informational purposes and is subject to change. Certain content represents an assessment of the market environment at a specific time and is not intended to be a forecast of future events or a guarantee of future results; material is as of the dates noted and is subject to change without notice.

The Fund relies on the existence of cap and trade regimes. There is no assurance that cap and trade regimes will continue to exist, or that they will prove to be an effective method of reduction in GHG emissions. Changes in U.S. law and related regulations may impact the way the Fund operates, increase Fund costs and/or change the competitive landscape. The Fund may invest in derivatives, which are often more volatile than other investments and may magnify the Funds’ gains or losses. A derivative (i.e., futures/forward contracts, swaps, and options) is a contract that derives its value from the performance of an underlying asset. The primary risk of derivatives is that changes in the asset’s market value and the derivative may not be proportionate, and some derivatives can have the potential for unlimited losses. Derivatives are also subject to liquidity and counterparty risk. The Fund is subject to liquidity risk, meaning that certain investments may become difficult to purchase or sell at a reasonable time and price. If a transaction for these securities is large, it may not be possible to initiate which may cause the Fund to suffer losses.

The Fund invests through a subsidiary, and is indirectly exposed to the risks associated with the Subsidiary’s investments. Since the Subsidiary is organized under the law of the Cayman Islands and is not registered with the SEC under the Investment Company Act of 1940, as such the Fund will not receive all of the protections offered to shareholders of registered investment companies. The Fund and the Subsidiary will be considered commodity pools upon commencement of operations, and each will be subject to regulation under the Commodity Exchange Act and CFTC rules. Commodity pools are subject to additional laws, regulations and enforcement policies, which may increase compliance costs and may affect the operations and performance of the Fund and the Subsidiary. Futures and other contracts may have to be liquidated at disadvantageous times or prices to prevent the Fund from exceeding any applicable position limits established by the CFTC. The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of the Index, changes in interest rates, or factors affecting a particular industry or commodity.

The Fund may underperform other similar funds that do not consider conscious company/ESG guidelines when making investment decisions. Fluctuations in currency of foreign countries may have an adverse effect to domestic currency values. The Fund is subject to interest rate risk, which is the chance that bonds will decline in value as interest rates rise. Narrowly focused investments typically exhibit higher volatility. The Fund’s assets are expected to be concentrated in an industry or group of industries to the extent that the Underlying Index concentrates in a particular industry or group of industries. The securities of companies in an industry or group of industries could react similarly to market developments. Thus, the Fund is subject to loss due to adverse occurrences that affect one industry or group of industries or sector. KEUA is non-diversified.

ETF shares are bought and sold on an exchange at market price (not NAV) and are not individually redeemed from the Fund. However, shares may be redeemed at NAV directly by certain authorized broker-dealers (Authorized Participants) in very large creation/redemption units. The returns shown do not represent the returns you would receive if you traded shares at other times. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns. Beginning 12/23/2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn't available, the midpoint between the national best bid and national best offer ("NBBO") as of the time the ETF calculates the current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.

The KraneShares ETFs, KFA Funds ETFs, and KraneShares Mutual Funds are distributed by SEI Investments Distribution Company (SIDCO), 1 Freedom Valley Drive, Oaks, PA 19456, which is not affiliated with Krane Funds Advisors, LLC, the Investment Adviser for the Funds, or any sub-advisers for the Funds.

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