Australia’s responsible investment and super fund manager Australian Ethical has debuted its first ETF offering, providing new access for all Australian investors to its ethical investment capability.
The High Conviction Fund ETF is an actively managed portfolio of 20 to 35 companies primarily drawn from the ASX 300, that each meets extensive ethical criteria for investment based on Australian Ethical’s rigorous Ethical Charter.
It is one of just a small handful of actively managed ethical ETFs in Australia, and will only invest in a select group of companies that exhibit attractive investment fundamentals based on the team’s in-depth research process.
What is an ETF?
Described in its purest form, an Exchange-Traded Fund acts as a basket of investment securities, and can include bonds, stocks and commodities. Typically, an ETF will work to track a particular index, sector, commodity, or other asset, and can even be utilised to track specific investment strategies. Unlike mutual funds, an ETF can be traded on any usual stock market, in just the same way that a regular stock can, with their price prone to the fluctuations usually expected from its traditional counterparts.
Mike Murray, Head of Domestic Equities of Australian Ethical, said: “The High Conviction Fund ETF is our first product in an increasingly important channel, to give all Australians investors access to our award-winning ethical investment and high-performance strategies. With rising demand for ethical investing, there is a growing need for access to authentic, true-to-label, and robust investment solutions across a range of different channels.
“Our first ETF leverages the combined depth of our ethical research and domestic equities capabilities, and seeks exposure to forward-looking industries such as renewables, healthcare, communications, and information technology. It targets a highly liquid portfolio of mid- and large-cap securities complemented by select smaller cap exposures that all meet our twin ethical and investment hurdles.”
John McMurdo, CEO and MD of Australia Ethical, adds: “Our investment team leverages over 35 years of proven track record and expertise as Australia’s original ethical investor. We are extremely proud of having some of the highest standards in the market for both our ethical portfolio and financial returns.
”Democratising access to ethical investment, through the release of products such as this ETF, is a very important part of our strategy.”
The ETF follows last year’s launch of the High Conviction Fund as a wholesale trust and complements a suite of domestic equities products that meet the growing demand for quality ethical investments with long-term capital appreciation. These have driven up Australian Ethical’s funds under management (FUM) 37.4 per cent in 12 month from $5.05billion to $6.94billion as of 31 December 2021.
Angus Dennis has also recently joined Australian Ethical as an Investment Director to lead the institutional channel strategy. Angus was formerly the Institutional Sales Executive at Vanguard Australia, and has over 30 years of experience in institutional funds management and marketing.