Thought leadership

Designed to facilitate equity financing, Eurex is introducing new equity total return futures (ETRFs) that replicate popular OTC equity swaps and incorporate the benefits of an exchange-listed product. Stuart Heath from Eurex explains what advantages ETRFs bring to banks and investors, and describes the role of indices in creating the new contracts.

It appears onerous and sometimes confusing, but the European Union’s Sustainable Finance Disclosure Regulation (SFDR) aims to enhance and protect participation in sustainable investments — a cause well worth the trouble.

Aligning portfolios with the UN Sustainable Development Goals is a fast-growing segment of responsible investing (RI), one with a different profile and outcome to ESG or climate considerations. A recent webinar explored how investors can employ the SDGs for portfolio management, index construction, reporting and more, using the Sustainable Development Investments Asset Owner Platform (SDI AOP).

We talk to Paul Lacroix, Ossiam’s Head of Structuring, about the switch of index underlying the Ossiam STOXX® Europe 600 Equal Weight NR ETF, and why an equal-weighted ESG strategy can boost both the ESG profile and price returns of a portfolio.

Fund issuers seeking to design sustainable-investment products to be distributed across European markets face an uphill struggle because of widely diverging national and regional frameworks. A new Qontigo whitepaper highlights the intricacy of Europe’s ESG labeling landscape and provides some recommendations that may help overcome its pitfalls.

How can investors push companies to have a more positive societal impact from their products and operations? And how can that impact be measured? Responsible Investor and Qontigo host a panel of experts who discuss these topics and more.

Variety in ESG data can enrich investment strategies and provide an edge in performance. Qontigo’s open-architecture approach is to find and leverage the most robust sustainability information available, with no limitation to any single provider, for each investing case.

Rebecca Chesworth, Senior Equities Strategist at State Street Global Advisors SPDR ETFs; and Hamish Seegopaul, Head of R&D for ESG and Quantitative Indices at Qontigo, discuss the change in underlying index for the SPDR® STOXX Europe 600 ESG Screened UCITS ETF and how clients’ ESG needs are shaping the product offering.

Sustainable investing strategies vary. Some investors, for example, simply want to improve ESG alignment. Others seek to maximize their impact on society, by investing in those companies that contribute the most to certain goals. While the metrics that underlie these approaches have some overlap, there is not perfect correlation, in terms of how metrics are defined, how portfolios are constructed, what is being targeted, etc.

A panel at COP26 comprised of sustainability and index experts, including members of Willis Towers Watson and Qontigo, explains how the STOXX Willis Towers Watson Climate Transition Indices (CTIs) help investors manage climate-transition risk and align their investments for the economic transition to net zero.

One of the panels at the Sustainability & Impact Investor Forum in Monaco last month drew from the perspectives of active fund management, asset-owner and indexing specialists, who discussed the key drivers and approaches to incorporate the transition to net zero into investment portfolios.

Lyxor ETF Germany and Austria’s Head of Product Development & Engineering explains how the change in the underlying index for the Lyxor 1 STOXX® Europe 600 UCITS ETF means the fund now complies with sustainability labels and meets the responsible criteria of retail and institutional European investors.