KraneShares Global Carbon Offset ETF (KSET) Now Tracks S&P Dow Jones Index
NEW YORK, NY, August 01 2022 -- Krane Funds Advisors, LLC ("KraneShares"), an asset management firm known for its global exchange-traded funds (ETFs) and innovative investment strategies, announced that the KraneShares Global Carbon Offset Strategy ETF (Ticker: KSET) now tracks the S&P GSCI Global Voluntary Carbon Liquidity Weighted Index—the first-to-market benchmark for the current performance of global voluntary carbon futures markets.
KSET, listed on the New York Stock Exchange on April 27 this year, is the first US-Listed ETF to track the global Voluntary Carbon Markets (VCM)1, which is complementary to the global carbon allowance markets tracked by KraneShares’ flagship global carbon ETF (KRBN).
KSET’s new index tracks carbon offset futures contracts. These contracts include nature-based global emission offsets (N-GEOs) and global emission offsets (GEOs), which trade through the CME Group, the world's largest financial derivatives exchange. Due to the evolving nature of carbon markets, an important characteristic of the index is the flexibility to reweight, add or remove constituents at regular intervals to ensure that it can adapt over time.
“Previously, KraneShares and IHS Markit, which is now part of S&P Global, made history when we launched the KraneShares Global Carbon Strategy ETF (KRBN). KRBN uses the IHS Markit Global Carbon Index as its benchmark,” said Luke Oliver, Managing Director and Head of Strategy at KraneShares. “We are pleased to deepen our relationship with S&P Global and leverage their extensive history as an index provider and their strong research capabilities to capture the complex and ever-changing voluntary carbon market through KSET’s new index.”
“We're excited that KraneShares has selected our S&P GSCI Global Voluntary Carbon Liquidity Weighted Index as the underlying benchmark for its exchange-traded fund,” said Fiona Boal, Head of Commodities and Real Assets at S&P Dow Jones Indices (S&P DJI). “This new voluntary carbon futures index is a key addition to S&P DJI’s continued efforts to grow its suite of new and innovative thematic alternative indices for the commodities space.”
“The voluntary carbon market serves as a powerful tool in the global fight to combat climate change and an important way to accelerate the transition to a decarbonized world,” said Eron Bloomgarden, co-founder of Climate Finance Partners (CLIFI) KSET’s non-discretionary sub-advisor. “At the same time, it provides price discovery, a potential hedge for climate risk exposure, and diversification* from traditional asset classes.”
The S&P GSCI Global Voluntary Carbon Liquidity Weighted Index was launched on June 22, 2022.
What are Carbon Offsets?
Carbon offsets are intended to counteract emissions that corporations, governments, or individuals generate as part of their business-as-usual activities. The governing bodies overseeing the registration and verification of carbon offset projects are called carbon offset registries. These registries issue credits for emission-reducing projects or programs such as forest conservation, the creation of wind farms, methane gas capture in a landfill, and hydropower projects. Credits are issued proportionate to the amount of greenhouse gas (GHG) a project takes out of the atmosphere. Entities can calculate their emissions and purchase a corresponding quantity of credits to offset their activity. Entities often utilize offsets as a short-term bridge to abate emissions that they cannot avoid within their own operations while they work on implementing longer-term decarbonization measures.
For additional information on the KraneShares Global Carbon Offset Strategy ETF (Ticker: KSET), contact your financial advisor or visit kraneshares.com/KSET.
About Krane Funds Advisors, LLC
Krane Funds Advisors, LLC is the investment manager for KraneShares ETFs. KraneShares is a premier platform that develops and delivers differentiated, high-conviction investment strategies to global investors.
Since 2013, KraneShares has become one of the leading China ETF providers. Given China's importance in addressing the global climate challenge, our Climate Suite is a natural extension of our China focus. KraneShares strives to deliver innovative first-to-market strategies based on strong partnerships and deep investing knowledge. KraneShares helps investors stay current on global market trends and provides meaningful diversification.
Krane Funds Advisors, LLC, is a signatory of the United Nations-supported Principles for Responsible Investing (UN PRI). The firm is majority-owned by China International Capital Corporation (CICC).
About Climate Finance Partners
Climate Finance Partners delivers innovative climate finance solutions and investment products to address capital needs for emerging environmental challenges. CLIFI is led by a team of investment professionals with deep experience in the fields of traditional investment and environmental finance.
*Diversification does not ensure a profit or guarantee against a loss.
- Data from Bloomberg as of 4/25/2022