LGIM expands ETF range with launch of four new strategies

Legal & General Investment Management (LGIM) has today announced the expansion of its Exchange Traded Fund (ETF) range with the launch of four new investment strategies.

The four new funds build on LGIM’s existing range of ETFs and will target thematic and growth oriented investment opportunities. Three of the new ETFs - Emerging Cyber Security, Optical Technology and Photonics, as well as Global Thematics - will sit within LGIM’s flagship thematic range; whereas the metaverse fund will sit within LGIM’s newly created ‘Access’ range.

The thematic ETF investment strategies are based on LGIM’s unique investment approach that blends active research and rules-based transparent implementation to create custom thematic indices that aim to offer investors purer exposure to themes, and underlying positions that are differentiated from traditional portfolios.

The new ‘Access’ range of investment strategies, of which the Metaverse Fund forms part, aims to provide exposures that are designed to serve as a tactical or strategic tool for investors seeking ‘access’ to non-traditional investment opportunities.

Exploring the metaverse

The metaverse describes the next frontier of the internet – a virtual reality enabled digital world in which people can work, travel, play and live. The growth potential is significant, with Meta Platforms alone spending more than $10 billion on metaverse R&D last year[1]. However, with the metaverse still in its infancy, LGIM has identified multiple investment opportunities related to the development still required, across hardware provision, software advances, networks and digital payments to augment human policing of the metaverse. The L&G Metaverse ESG Exclusions

UCITS ETF aims to offer targeted exposure to companies actively involved in developing the technologies needed to deliver the metaverse.

Emerging cyber security

LGIM has been at the forefront of investing in cyber security, since launching the first European cyber security ETF in 2015. Innovation has underscored the growth of cyber security and has enabled companies to stay ahead of cyber attacks. From anti-virus softwares and malware protection to cloud security and secure hardware - the industry has seen an expansion in segments that cyber security companies specialise in. The launch of L&G Emerging Cyber Security ESG Exclusions UCITS ETF reflects that evolution, as it seeks to provide access to this growing and rapidly evolving megatrend in a manner that is complementary to LGIM’s existing flagship cyber security ETF. The new ETF will focus on emerging segments such as hardware security, threat intelligence and blockchain enabled security solutions, in addition to growth segments, such as cloud and network related security solutions that are also captured in the existing fund.

Harnessing the science of light

Optical technology and photonics is the science of creating, manipulating, transmitting and detecting light. Ironically, given it is one of the most used technologies in our daily lives, but the industry’s far-reaching impact is not well understood. From smartphone displays, precision agriculture and automotive sensors to fibre-optic broadband and laser surgery, photonics plays a highly critical role. The European Commission has recognised it as one of the key enabling technologies of the 21^st century which can bridge the gap between the physical world and the systems that exist within it. With the global photonics industry estimated to be growing at more than twice the rate of global GDP[1] and three times faster than EU GDP3, the L&G Optical Technology & Photonics ESG Exclusions UCITS ETF, is the first ETF in Europe that focuses on providing exposure to leading companies in the theme. The underlying investment strategy leverages the expertise of European Photonics Industry Consortium (EPIC), the largest photonics industry association in the world.

Providing convenient access to global themes

For investors looking to gain access to multiple themes, LGIM has also today announced the launch of the L&G Global Thematic ESG Exclusions UCITS ETF, comprising a diversified, risk-balanced basket of companies involved in multiple investment themes, focused on innovation and long-term growth. The fund combines the investment universes of LGIM’s existing individual thematic strategies and brings together nine investment themes, in the areas of technology, energy and resources and changing demographics, all of which are currently available to investors via L&G building-block ETFs.

Each of the new funds announced today incorporates an ESG overlay which aims to exclude companies not compliant with the United Nations Global Compact. They are listed on the London Stock Exchange, Borsa Italiana, Deutsche Boerse and Six Exchange.