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ESG Focus: ETFs Outperform in October

ESG Focus | Dec 04 2018

As world stock markets headed for correction in October, ESG-based exchange traded funds notably outperformed.

By Greg Peel

The month of October saw the US stock market (S&P500) fall -6.8%. Given Wall Street had previously rallied to new highs, at end-October the S&P was still up 3.1% year to date.

Markets elsewhere have not fared as well. Europe fell -7.8% to be down -9.6% for the year, and emerging markets fell -7.6% to be down -15.1%.

The ASX200 fell -6.1% to be down -4.8%.

According to London-based research house EFTGI, total assets in Environmental, Social & Governance (ESG) based exchange traded funds (ETF) globally fell -2.9% in October. Despite the falling market, global ESG ETFs saw US$1.1bn of inflows during the month.

Year to date (to end October), the value of all ETFs listed globally rose by 2.5%. The value of ESG ETFs rose 25.9% in the same period.

The first ESG-based ETF was listed in 2002 in the US. At end-October there were 200 ESG-ETFs listed globally covering a diversity of assets – not just shares – and 62 of those were launched this year. October alone saw 11 new listings.

At end-October the net value of ESG ETFs was US$21.9bn.

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