Invesco has expanded its suite of thematic ETFs in Europe with the launch of three new global equity funds, offering access to long-term growth trends in artificial intelligence, cybersecurity, and defence.
Gary Buxton, Head of EMEA and APAC ETFs at Invesco.
The Invesco Artificial Intelligence Enablers UCITS ETF (USD: IVAI LN; GBP: IAIX LN), Invesco Cybersecurity UCITS ETF (USD: ICBR LN; GBP: CBRX LN), and Invesco Defence Innovation UCITS ETF (USD: IDFN; GBP: DFNX LN) are listed on London Stock Exchange.
Additional listings on SIX Swiss Exchange in Swiss francs as well as on Xetra and Borsa Italiana in euros are also available.
Each ETF tracks an index constructed by Kensho, a specialist branch of S&P Global Indices, known for its innovative application of AI and other advanced benchmarking techniques.
The AI ETF tracks the S&P Kensho Global Artificial Intelligence Enablers Screened Index which targets companies developing AI technologies and the infrastructure supporting their growth.
The cybersecurity ETF tracks the S&P Kensho Global Cyber Security Screened Index which focuses on companies specializing in the protection of enterprises and devices from cyber threats.
Finally, the defence ETF tracks the S&P Kensho Global Future Defense Index which homes in on companies involved in the development of cutting-edge weapons, defensive systems, and solutions for securing national borders.
Kensho leverages artificial intelligence to analyze large amounts of company data to identify those firms that are tied to each underlying theme.
Kensho’s analysts further classify the companies included in the indices into two categories: “Core”, those with a significant portion of their operations and revenues directly tied to the theme; and “Non-Core”, those that are involved in the broader value chain, providing critical inputs such as subcomponents.
The index construction applies an overweight factor to Core companies, ensuring that the ETFs place greater emphasis on firms with a central role in their respective themes. Companies within each category are equally weighted subject to diversification and liquidity constraints.
Gary Buxton, Head of EMEA and APAC ETFs at Invesco, commented: “While the potential of AI has really captured people’s imagination, solutions for cybersecurity and defence are now gaining traction as threats emerge across the globe. For investors, the question is how best to capture these opportunities today and into the future. We chose to work with Kensho for their intelligent approach to applying AI but also their expertise in understanding these rapidly evolving new technologies. Plus, their being part of the S&P Global Index group should provide investors with a higher degree of confidence in the administration.”
The AI and cybersecurity ETFs are classified Article 8 under the European Union’s Sustainable Finance Disclosure Regulation (SFDR) as their underlying indices also screen out violators of UN Global Compact principles, companies engaged in controversial business activities, and firms with poor ESG scores.
Each ETF comes with an expense ratio of 0.35% which represents the lowest – or joint lowest – annual charges among similar competing products.
These new ETFs further broaden Invesco’s thematic investment offering in Europe, complementing existing funds that focus on sectors such as blockchain, biotechnology, US infrastructure, and clean energy, among others.