Investors focus on sustainability with ETFs

19 Apr 2021

Investors focus on sustainability with ETFs

More than 300 ETFs on Xetra now focus on sustainability – and the trend is rising. The assets invested in ESG ETFs are also growing rapidly. With the iShares Global Clean Energy UCITS ETF, for the first time an ESG ETF was the ETF with the highest turnover on the Xetra trading platform in the first quarter of 2021.

What started as a trend will, according to experts, be a driving force behind the choice of investments in the coming years: the topic of sustainability (ESG). Sustainability in investment means including ecological, social and ethical aspects in investment decisions, alongside classic criteria such as profitability, liquidity and security. The total amount of assets managed according to ESG criteria worldwide has increased rapidly in recent years. “As the range of ESG ETFs continues to grow, more and more investors are turning to the sustainable variant of established benchmark indices,” explains Stephan Kraus, who is responsible for the ETF segment at Deutsche Börse.

The continued strong growth in demand for sustainable ETFs is also reflected in 2021’s first quarter trading statistics: with the iShares Global Clean Energy UCITS ETF, for the first time an ESG ETF was the product with the highest turnover in Deutsche Börse's ETF segment. The ETF generated an order book turnover of EUR 2.4 billion and aims to replicate the performance of an index that tracks the 30 largest companies worldwide operating in the renewable energy sector. The largest stocks within the ETF include Plug Power, Enphase, Siemens Gamesa, Verbund and First Solar.

In total, 252 products classified as ESG ETFs were available to investors on Xetra at the end of the year 2020 (2019: 149). At the end of the first quarter in 2021, there were already 307. Turnover in ESG ETFs rose to €12.2 billion in 2020, an increase of 290 per cent compared to the previous year (2019: €3.1 billion). This makes Xetra the leading exchange for sustainable ETFs in Europe.

More facts and figures can be found in the ETF Statistics 2020.

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