KraneShares MSCI China Environment ETF (Ticker: KGRN) Lists on the New York Stock Exchange
Krane Funds Advisors, LLC, (“KraneShares”) a U.S. asset management firm known for its China focused KraneShares exchange traded funds (ETFs) and innovative China investment strategies, announced the launch of the KraneShares MSCI China Environment ETF (Ticker: KGRN). KGRN holds Chinese companies that derive at least 50% of their revenues from environmentally beneficial products and services.
China has grown to become the second largest economy and second largest stock market in the world by market capitalization. China’s economic growth has triggered an increase in automobile ownership, construction projects and energy consumption, particularly coal consumption; all currently at their decade highs. China’s rapid economic development has impacted the environment with current levels of air and water pollution higher than those recommended by the World Health Organization.
In order to address pollution concerns, China has set ambitious goals to expand environmental protections. China is already the world leader in total renewable energy capacity, at 28% of total global capacity1, yet they plan to spend an additional $360 billion on renewable energy by 20202. At the same time China aims to achieve 50% commercial green building certification by 20203. Meeting these standards would create as much new renewable energy capacity as the entire US electricity system4, and half of the world’s green building floor space3.
“China is currently undergoing an environmental renaissance, pledging hundreds of billions of dollars to environmental protection projects and policies” said Jonathan Krane, Chief Executive Officer of KraneShares. “We believe Chinese companies focused on contributing to a more environmentally sustainable economy may potentially benefit from this focused initiative”.
KGRN seeks to track the MSCI China IMI Environment 10/40 Index. The Index is based on five key Clean Technology environmental themes: Alternative Energy, Sustainable Water, Green Building, Pollution Prevention and Energy Efficiency. Company selection is based on environmental, social and governance (ESG) data from MSCI ESG Research. MSCI is a leading provider of ESG research and indexes according to the 2016 Independent Research in Responsible Investment (IRRI) survey of 1,200 participants conducted by SRI Connect and Extel.
“The MSCI China IMI Environment 10/40 Index highlights MSCI’s commitment to helping global investors implement their responsible investment objectives,” said Christine Berg, CFA, Managing Director at MSCI. “The index incorporates MSCI ESG Research and is comprised of Chinese companies that focus on contributing to a more environmentally sustainable economy”.
KraneShares will be holding a live webinar on Thursday, November 30th at 11:00am EST. During the webinar we will review The KraneShares MSCI China Environment ETF (Ticker: KGRN), the evolution of China’s environmental protection initiatives, and the companies that may potentially benefit from positive environmental policy in China. Click here to register for the webinar.
This article is intended for educational purposes only and should not be construed as investment advice. All opinions or views expressed in this article are current only as of the date of this article and are subject to change without notice.
- REN21’s Renewables 2017 Global Status Report (GSR) pg 166
- Michael Forsythe, “China Aims to Spend at Least $360 Billion on Renewable Energy by 2020”, The New York Times, 1/5/2017. Retrieved 7/21/2017
- UTC, “Accelerating the World’s Largest Green Building Market: China.” Oct. 4, 2016
- Barbara Finamore, “Paris Climate Agreement Explained”, National Resource Defense Council, Dec. 12, 2015
The KraneShares ETFs 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 Fund. Additional information about SIDCO is available on FINRA’s BrokerCheck.