Fidelity International has announced the launch of the Fidelity Global Equity Research Enhanced PAB UCITS ETF, a new fund designed to invest in global equities to achieve income and capital growth. The fund aligns with the climate objectives of the Paris Agreement by limiting the carbon emissions exposure of its portfolio.
This new offering is part of Fidelity’s Research Enhanced ETF range, which utilises the firm’s research capabilities to provide active exposure through fundamental analysis and forward-looking sustainability assessments. Classified as Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR), the ETF is the first equity fund in the Research Enhanced range to follow the Paris-Aligned Benchmark (PAB) framework. Under EU rules, PAB-labelled indices must meet asset selection criteria that align them with the Paris Agreement’s long-term climate goals, including a minimum reduction in greenhouse gas (GHG) emissions intensity of at least 50% compared to the market index, with annual reductions of at least 7%.
Jenn-Hui Tan, Chief Sustainability Officer at Fidelity International, stated, “Sustainability remains a core consideration for many of our investors, and we are seeing increased demand for a greater range of options to express their sustainability preferences. This natural evolution of our product range provides more choice and greater transparency for those clients seeking to integrate climate objectives alongside financial goals in their investment portfolios.”
The actively managed fund will reference the Solactive ISS ESG Screened Paris Aligned Developed Markets USD Index NTR as its benchmark. It will employ a combination of quantitative and fundamental research to select and weight securities, aiming to maximise returns relative to the benchmark, align with the benchmark’s carbon emissions performance, and tilt towards securities with higher ESG ratings.
Neil Davies, Head of ETF Product & Capital Markets for Europe and Asia Pacific at Fidelity International, commented, “At Fidelity, we’re proud to bring our clients a broad and growing range of active ETFs that tap into the depth of our global research and investment expertise. This addition to our Research Enhanced ETF range provides clients even greater choice across asset class, geography and sustainability preference, all utilising the active insights from Fidelity’s global investment platform aiming to deliver market beta and alpha at a competitive price.”
