BetaShares to launch Energy Transition Metals ETF

BetaShares has announced the launch of its Energy Transition Metals exchange traded fund (ETF) (XMET) on the Australian Securities Exchange (ASX) in late October, subject to regulatory approval.

The new fund would offer exposure to global companies that are both producing and involved in the discovery, development and manufacture of energy transition metals (ETM) such as copper, lithium, nickel, cobalt, graphite, manganese, silver and other rare earth metals.

XMET would offer access to ‘pure play’ ETMs producers as well as diversified producers and recyclers of ETMs.

BetaShares said that its investment methodology of XMET would include a number of ESG (environmental, social, governance) screens to remove companies receiving material revenues from “certain business activities”, such as oil and gas production as well as thermal coal extraction.

“Reflecting the importance of these materials, many global companies and national governments are investing significant amounts of capital with the aim of securing supply of these critical components. Demand for these materials is projected to remain high, while, at the same time, supply is structurally constrained”, BetaShares chief executive, Alex Vynokur, said.

The transition from fossil fuels to clean energy solutions was expected to drive growth in a range of disruptive products and processes such as renewable energy generation, battery storage solutions, and electric vehicles, all of which were critically dependent on a select group of energy transition metals (ETMs).