Fidelity International has expanded its climate fixed income range with the launch of a Paris-aware global government bond ETF.
The Fidelity Global Government Bond Climate Aware UCITS ETF (FGGB) is listed on the London Stock Exchange, Deutsche Boerse, SIX Swiss Exchange and the Borsa Italiana with a total expense ratio (TER) of 0.20%.
The ETF tracks the Solactive Paris Aware Global Government USD index which offers exposure to the performance of global local currency bonds of investment grade countries.
The index will also try to exhibit a level of carbon intensity 14% lower than the investible universe while aiming for a year-on-year decarbonisation target of 7% per annum.
The index is weighted to the decarbonisation targets as well as other factors including bond issuance levels, yield levels and foreign exchange rates.
It added a minimum of 50% of the ETF will be invested in countries with “favourable ESG characteristics”.
The fund is labelled Article 8 under the Sustainable Finance Disclosure Regulation (SFDR).
Nick King (pictured), head of ETFs at Fidelity International, said: “Sustainable investing is a key priority for many of our clients and often they are focused on managing climate change through their investment allocations.
“This new ETF provides investors with a highly diversified global government bond exposure aligned to climate objectives. This expands our existing range of climate-focused fixed income ETFs, providing innovative, cost-effective building blocks for asset allocation.”
It takes the number of PAB bond ETFs in Fidelity’s range to three including the Fidelity Sustainable Global Corporate Bond Paris-Aligned Multifactor UCITS ETF (FSMF) launched last November and the Fidelity Sustainable Global High Yield Bond Paris-Aligned Multifactor UCITS ETF (FHGY) unveiled last March.
