Stockholm (NordSIP) – As is now widely acknowledged, sustainable finance is here to stay. However, the industry is not equally developed on both sides of the pond. According to J.P. Morgan Asset Management (JPMAM)’s Global ETF Study 2020, published at the end of 2020, “European investors lead the way with the adoption of sustainable investment strategies and integration of ESG funds into portfolios. US investors are less enthusiastic, perhaps reflecting skepticism over sustainable investing and the impact on returns.”
As a result, it is not surprising to see asset managers cross the pond to tap the popularity that sustainable finance enjoys in the old continent. Two of the most recent examples of this trend were provided by JPMAM and Capital Group.
JPMAM’s Global Income Sustainable Fund
On February 22nd, JPMAM launched the JPMorgan Investment Funds – Global Income Sustainable Fund (SICAV), a globally diversified multi-asset income fund with a sustainable focus. Michael Schoenhaut and Eric Bernbaum will manage the fund, which is an ESG version of the US$29 billion flagship JPMorgan Investment Funds – Global Income Fund (SICAV). The fund appears to follow a familiar structure, enhancing the benchmark by exclusion ten unsustainable sectors from its holdings and reweighting the remaining stocks in favour of securities with a better ESG scores. The two funds are expected to only have about 30% overlap in holdings and the sustainable fund is expected to have 65% lower carbon emissions, than the multi-asset income investment universe.
“In the continued incredibly low yield environment, investors need more sustainable sources of diversified income,” Massimo Greco, head of EMEA funds at J.P. Morgan Asset Management, said. “For more than a decade with our Global Income Fund, we’ve provided investors with a disciplined and rigorous approach, supported by strong research capabilities, to finding the best risk-adjusted income opportunities globally, across multiple geographies and asset classes. We’re thrilled to now expand our offering with this dedicated sustainable multi-asset income fund.”
Capital Group’s European Opportunities fund
On February 23rd, Capital Group announced the launch of its European Opportunities fund, which seeks to provide investors with exposure to sustainable global growth opportunities from industry-leading European companies global client base. This diverse pool of customers is expected to provide diversified revenue streams that are not necessarily reliant on the health of the domestic European economy. The strategy has a 28-year track reccord and has reportedly returned an excess 5.5% per annum.
“Europe is home to leading companies whose profiles are difficult to find anywhere else in the world – luxury goods and online shopping are good examples,” Martyn Hole, Investment Director, commented. “European Opportunities is a great example of the breadth and depth of our research capabilities, helping investors access European investment opportunities from a truly global investment perspective.”