Ossiam has announced the listing of a new exchange-traded fund, the Ossiam Euro Government Bonds 3-5Y Carbon Reduction UCITS ETF 1C (EUR), on the Xetra exchange in Germany. The fund launches with €200m of investor capital.

The objective of the new ETF is to provide investors with exposure to eurozone bonds with a three to five year maturity tranche incorporating a systematic reduction of the portfolio’s carbon footprint by weighting dependent on countries’ respective carbon footprints. To limit relative risks, the composition returns to the benchmark’s performance and risk/return profile when the spreads between Germany and other Eurozone countries diverge at an accelerating rate.

The fund’s strategy aims to replicate the performance of the ICE (Intercontinental Exchange) 3-5 Year Euro Government Carbon Reduction Index.

Bruno Poulin, CEO of Ossiam (pictured), said: “We are very pleased to announce the launch of our latest ETF to add to our ESG product range. It’s an additional component for investors who wish to manage their portfolio’s total carbon footprint.”

The strategy has an average fossil carbon emission target 30 per cent lower than that of the investment universe. The target is calculated using the carbon data of each country in the portfolio and their respective weights, based on fossil CO2 per capita data published in the EU’s Emissions Database for Global Atmospheric Research.

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