WisdomTree unveils megatrend ETF covering 14 themes

FundDec 12, 2023

WisdomTree has launched an ETF that allows investors to access diversified exposure to 14 themes in a single fund.

The WisdomTree Megatrends UCITS ETF (WMGT) listed today (11 December) on Börse Xetra and will list on the London Stock Exchange on 12 December with a total expense ratio of 0.5%.

Its themes are categorised under three megatrends - technological shifts, environmental pressures and demographic and social shifts.

The company explained that artificial intelligence and big data, blockchain, cloud computing, cybersecurity, digital infrastructure, healthtech and semiconductors fall under technological shifts.

Environmental pressures include sustainable energy production, sustainable energy storage, sustainable food and sustainable resource management.

Finally, aging population, rise of emerging market consumer and rise of the middle class are the themes for demographic and social shifts.

WMGT tracks the WisdomTree Global Megatrends Equity index, which focuses on global companies that meet the firm's ESG criteria and are involved in megatrends including social, technological, environmental or geopolitical shifts.

The ETF was built around "three layers of alpha generation", which refers to "strategic and tactical" asset allocation and thematic stock selection.

Chris Gannatti, global head of research, said: "An overly concentrated portfolio, a lack of control around the allocation between themes, a lack of focus on smaller, high-potential companies or a lack of discipline and theme expertise in stock selection can all diminish or even erase the impact of thematic investments.

"Through the strategy, investors are able to gain exposure to the most important and transformative themes, benefit from short-term trends in thematics, maximise diversification between themes and growth potential, while minimising exposure to mega caps through a focus on pure play up-and coming companies."

WisdomTree Megatrends UCITS ETF is the firm's eleventh thematic equity ETF in its $1.4bn range.

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