Global X Funds has announced changes to its Global X YieldCo Index ETF (YLCO US).

YieldCos are publicly traded companies that are formed by parent companies operating in the renewable energy sector to own operating assets that produce defined cash flows.

As of 19 November 2018, the fund will switch from tracking the Indxx Global YieldCo Index to the Indxx YieldCo & Renewable Energy Income Index.

The ETF was launched on Nasdaq Exchange in May 2015 to provide investors with exposure to income generating renewable energy assets called YieldCos.

YieldCos are publicly traded companies that are formed to own operating assets that produce defined cash flows.

They are commonly used in the energy industry, particularly in renewable energy, to protect investors against regulatory changes. They serve the same purpose as master limited partnerships (MLPs) and real estate investment trusts (REITs), which most utilities can’t form due to regulatory constraints.

YLCO is currently the only ETF to offer targeted exposure to this unique market.

The new index will expand the investment mandate of the fund to include the parent renewable energy companies as long as those firms meet minimum dividend yield criteria, as determined by Indxx.

Concurrent with the index change, the name of the fund will be changed to the Global X YieldCo & Renewable Energy Income ETF. Its ticker will remain unchanged.

The ETF comes with an expense ratio of 0.65% and currently offers a dividend yield of around 5%.