Lyxor has cross-listed its suite of ESG “Trend Leaders” ETFs onto Borsa Italiana.

Lyxor has listed its ESG “Trend Leaders” ETF suite on Milan’s Borsa Italiana.

Aimed at ethically conscious and socially responsible investors based in Italy, the ETFs provide exposure to the equity performance of high ESG (Environmental, Social and Governance) rated companies within the global, US, eurozone, and emerging markets universes.

Each fund tracks an MSCI index that is designed to represent the performance of companies with a robust ESG profile characteristics, as well as a positive trend in improving that profile.

ESG ratings are assigned using analytics from MSCI, with the index provider using a seven-point scale from ‘AAA’ to ‘CCC’ based on how the company manages key issues relative to industry peers.

The indices aim to achieve sector weights that reflect the relative sector weights of the underlying parent index to limit the systematic risk introduced by the ESG selection process. MSCI achieves this by selecting the firms with the highest ESG ratings representing approximately 50% of the free float-adjusted market capitalisation within each GICS sector of the underlying MSCI parent index.

MSCI then identifies those companies with a positive trend by tracking the ESG rating change from the prior period to the current period. Firms whose ratings have been upgraded over the period are assigned a positive score, which in turn increases their weight within the index.

The new ETFs, which trade in euros on Borsa Italiana, are as follows:

Lyxor MSCI World ESG Trend Leaders UCITS ETF (WESG IM); TER – 0.30%
Lyxor MSCI USA ESG Leaders UCITS ETF (UESG IM); TER – 0.25%
Lyxor MSCI EMU ESG Trend Leaders UCITS ETF (EESG IM); TER – 0.20%
Lyxor MSCI EM ESG Trend Leaders UCITS ETF (MESG IM); TER – 0.30%

The funds are also available on Xetra in euros and on London Stock Exchange in US dollars, except for the EMU fund which trades on LSE in pound sterling.