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Assets in equity ETFs linked to MSCI indexes surpass $1trn

With demand expected to rise for ESG, factor, thematic and fixed income

Equity funds drive Ucits sales

Strong investor demand for transparent and liquid products to access global equity markets has driven asset growth in equity ETFs linked to MSCI’s indexes, the data provider has said.

It also attributed the increase to rising focus on ESG and climate consideration and the interest in factor index-linked strategies.

MSCI said there are currently more than 1,500 equity and fixed income ESG and climate indexes which utilise its ESG Research ratings and data.

And demand for standard and custom solutions in this area is growing.

Where to next?

As indexed investing continues to rise, MSCI believes ESG, climate, factors, thematic and fixed income investment will mark the next stage of growth for ETF-linked exposures.

There are over $71bn in ESG and climate equity ETF assets linked to MSCI indexes, with seven of the 10 largest equity ESG ETFs in the US benchmarked to MSCI indexes.

Henry Fernandez, MSCI’s chairman and chief executive, said: “The investment industry continues a tremendous transformation towards new opportunities; including new geographies, new asset classes, new styles and strategies, and more sustainable investing.

“MSCI is positioned to be the change agent that helps investors stay at the forefront of that transformation and on the efficient frontier of risk and return, as well as the partner of choice for investors around the world who are seeking exposure to the world’s capital markets and need to understand the opportunity set.”

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