KraneShares Expands Carbon Market Offering with Launch of European and California Carbon ETFs: KEUA and KCCA
Krane Funds Advisors has launched two new carbon market ETFs: the KraneShares European Carbon Allowance ETF (KEUA) and the KraneShares California Carbon Allowance ETF (KCCA). These funds aim to provide targeted exposure to carbon allowance markets under cap-and-trade programs, assisting in achieving climate goals. The firm’s existing KraneShares Global Carbon ETF (KRBN) has accumulated over $900 million in AUM and returned 105.45% since inception. KEUA focuses on the EU market, while KCCA targets California's emissions, which cover significant portions of their respective total emissions.
- Launch of KEUA and KCCA expands KraneShares' carbon market offerings.
- KEUA targets the European cap-and-trade market, aiming for 55% reduction in emissions by 2030.
- KCCA focuses on California's carbon market, with a goal of 40% reduction from 1990 levels by 2045 and covers 80% of the state's emissions.
- KRBN has successfully accumulated over $900 million in assets and returned 105.45% since inception.
- None.
NEW YORK, Oct. 5, 2021 /PRNewswire/ -- Krane Funds Advisors, LLC, ("KraneShares"), an asset management firm known for its global exchange-traded funds (ETFs) and innovative investment strategies, is pleased to announce the expansion of its carbon market offering with the launch of the KraneShares European Carbon Allowance ETF (KEUA) and the KraneShares California Carbon Allowance ETF (KCCA).
Under the cap-and-trade programs, carbon allowances put a price on carbon emissions, engaging market forces to tackle climate change. Each emissions trading program covered in the KraneShares suite is a powerful policy tool for achieving the ambitious climate targets set in the Paris Agreement.
The two new funds join KraneShares growing carbon market suite alongside the KraneShares Global Carbon ETF (NYSE: KRBN), which was listed in July 2020 on the New York Stock Exchange. Since its inception, the fund has accumulated over
"Through the phenomenal success of KRBN, we learned that many of our clients also want targeted exposure to the underlying markets," said Luke Oliver, Managing Director and Head of Strategy at KraneShares. "KEUA and KCCA provide access to the component carbon allowance markets at various stages of their growth cycle. With these new ETFs, investors can take a customizable precision-approach to invest in carbon markets."
- The KraneShares European Carbon Allowance ETF (KEUA) provides exposure to the European Union Allowances (EUA) cap-and-trade program, the world's oldest and most liquid carbon allowance market. The program aims to reduce emissions by at least
55% of 1990 levels by 2030 and climate neutrality by 2050. It covers approximately40% of the EU's total emissions.3 - The KraneShares California Carbon Allowance ETF (KCCA) provides exposure to the California Carbon Allowances (CCA) cap-and-trade program and covers approximately
80% of the state's emissions. In 2014, the program expanded to cover Quebec. The program plans to achieve a40% reduction from 1990 greenhouse gas levels and carbon neutrality by 2045.4
"We believe investors are attracted to the carbon allowance investment opportunity because they see its low-correlated growth potential, which can also have a positive impact on the planet," said Jonathan Krane, CEO of KraneShares. "Our Europe and California carbon ETFs join KRBN in expanding KraneShares' position as a leader in carbon market investment solutions."
"Economists agree that one of the best policy tools we have to confront the enormous challenge of climate change are emissions trading programs," said Eron Bloomgarden, Co-Founder of Climate Finance Partners, the non-discretionary subadvisor to KRBN, KEUA, and KCCA. "Our suite of carbon market ETFs helps to catalyze climate-action and compliment the progress of cap-and-trade programs. We believe there may also be significant upside potential in the market as the world addresses the climate crisis."
For more information about KRBN, KEUA, or KCCA, email info@kraneshares.com.
About KraneShares
Krane Funds Advisors, LLC is the investment manager for KraneShares ETFs. Our suite of China-focused ETFs provides investors with solutions to capture China's importance as an essential element of a well-designed investment portfolio. We strive to provide innovative, first to market strategies that have been developed based on our strong partnerships and our deep knowledge of investing. We help investors stay up to date on global market trends and aim to provide meaningful diversification. Krane Funds Advisors, LLC, is a signatory of the United Nations-supported Principles for Responsible Investing (UN PRI). The firm is majority-owned by China International Capital Corporation (CICC).
About Climate Finance Partners
Climate Finance Partners (CLIFI) serves as the non-discretionary subadvisor to KRBN, KEUA and KCCA. CLIFI delivers innovative climate finance solutions and investment products to address capital needs for emerging environmental challenges. CLIFI is led by a team of investment professionals with deep experience in the fields of traditional investment and environmental finance. The Advisory Board is Chaired by Nobel Laureate, Robert Engle.
Diversification does not ensure a profit or guarantee against a loss.
KRBN Performance as of 9/30/21
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The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investors shares, when sold or redeemed, may be worth more or less than their original cost and current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, please visit www.kraneshares.com.
Citations
1. Data as of 9/30/21
2. Data from Bloomberg as of 10/1/21
3. IHS Markit, 12/31/2020
4. California Air Resources Board, 2017
Important Notes
Carefully consider the Funds' investment objectives, risk factors, charges, and expenses before investing. This and additional information can be found in the Funds' full and summary prospectus, which may be obtained by visiting KRBN, KEUA, KCCA. Read the prospectus carefully before investing.
Risk Disclosures
Investing involves risk, including possible loss of principal. There can be no assurance that a Fund will achieve its stated objectives.
The Funds are subject to liquidity risk, meaning that certain investments may become difficult to purchase or sell at a reasonable time and price. If a transaction for these securities is large, it may not be possible to initiate which may cause the Fund to suffer losses.
The Funds rely on the existence of cap-and-trade regimes. There is no assurance that cap and trade regimes will continue to exist, or that they will prove to be an effective method of reduction in GHG emissions. Changes in U.S. law and related regulations may impact how the Fund operates, increase Fund costs and/or change the competitive landscape. Funds may underperform other similar funds that do not consider conscious company/ESG guidelines when making investment decisions.
The Funds invest through a subsidiary and are indirectly exposed to the risks associated with the respective Subsidiary's investments. Since the Subsidiary is organized under the law of the Cayman Islands and is not registered with the SEC under the Investment Company Act of 1940, as such the Fund will not receive all of the protections offered to shareholders of registered investment companies.
The Funds and their subsidiaries will be considered commodity pools upon commencement of operations, and will be subject to regulation under the Commodity Exchange Act and CFTC rules. Commodity pools are subject to additional laws, regulations and enforcement policies, which may increase compliance costs and may affect the operations and performance of the Fund and the Subsidiary. Futures and other contracts may have to be liquidated at disadvantageous times or prices to prevent the Fund from exceeding any applicable position limits established by the CFTC.
The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of the Index, changes in interest rates, or factors affecting a particular industry or commodity.
Investments in non-U.S. instruments may involve risk of loss due to foreign currency fluctuations and political or economic instability. The Fund's assets are expected to be concentrated in an industry or group of industries to the extent that the Index concentrates in a particular industry or group of industries. The Funds are non-diversified.
Fund shares are bought and sold on an exchange at market price (not NAV) and are not individually redeemed from the Fund. However, shares may be redeemed at NAV directly by certain authorized broker-dealers (Authorized Participants) in very large creation/redemption units. The returns shown do not represent the returns you would receive if you traded shares at other times. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns. Beginning 12/23/2020, market price returns are based on the official closing price of an ETF share or, if the official closing price isn't available, the midpoint between the national best bid and national best offer ("NBBO") as of the time the ETF calculates the current NAV per share. Prior to that date, market price returns were based on the midpoint between the Bid and Ask price. NAVs are calculated using prices as of 4:00 PM Eastern Time.
The KraneShares ETFs are distributed by SEI Investments Distribution Company (SIDCO), which is not affiliated with Krane Funds Advisors, LLC, the Investment Adviser for the Fund, or any sub-advisers for the Funds.
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SOURCE Krane Funds Advisors, LLC
FAQ
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