The smart beta exchange traded fund will invest in large- and mid-cap Chinese equity securities and will overweight Chinese companies transitioning to a lower-carbon economy.
It is designed to support investors who wish to reduce their exposure to transition and physical climate risks, and will track the EU Climate Benchmark PAB and MSCI China Climate Paris-Aligned indices.
It is Franklin Templeton’s third EU Sustainable Finance Disclosure Regulation (SFDR) Article 9 compliant strategy within the Franklin LibertyShares range.
The firm’s head of global index portfolio management Dina Ting and ETF portfolio manager Lorenzo Crosato will manage the fund. The ETF will have a total expense ratio of 0.22%.
Caroline Baron, head of ETF business development, EMEA, at Franklin Templeton, said: “The ETF is a natural extension of the Paris-Aligned Climate ETF product range we launched two years ago and provides exciting growth opportunities in Chinese stock markets by investing in securities transitioning to a low carbon economy.”
She continued: “Aligned with the EU Climate Benchmark Regulation, it will additionally offer investors key standardisation, transparency and reporting benefits and should appeal to a wide range of European investors seeking more sustainable investment solutions.”
The fund will be listed on the London Stock Exchange on 17 June.