RARE becomes the ninth ETP in WisdomTree’s Energy Transition range
WisdomTree, a global provider of financial products, today expanded its range of thematic exchange-traded funds (ETFs) with the launch of the WisdomTree Energy Transition Metals and Rare Earths Miners UCITS ETF (RARE).
RARE attempts to replicate the price and performance, before fees and expenses, of the WisdomTree Energy Transition Metals Index and the Rare Earth Miners Index (the “Index”) and has a total expense ratio (TER) of 0.50%. The WisdomTree Energy Transition Metals and Rare Earths Miners UCITS ETF (RARE) begins trading today on the Börse Xetra and Borsa Italiana exchanges, and will do so on the London Stock Exchange on April 10, 2024.
Private index It is designed to track the performance of listed companies in developed and emerging markets, which is primarily involved in the energy transition minerals value chain, including exploration and processing of rare earth elements, and which meets WisdomTree’s ESG (environmental, social and governance) criteria. In keeping with WisdomTree’s focus on creating thematic ETFs that provide pure, differentiated exposures, WisdomTree has partnered with Wood Mackenzie, a leading energy transition research and advisory firm. The selection of stocks for the index is based on Wood Mackenzie’s experience and market information.
Under Wood Mackenzie’s 1.5 degree scenario, electricity and renewable energy would support the reduction of carbon dioxide emissions. The 1.5 degree scenario requires capital spending estimated at $60 trillion by 2050, with electricity requirements, using solar and wind power, driving investment flows. The energy transition will be mineral-intensive and will be positive for important metals and mining companies involved in the energy transition value chain.
The index that follows the WisdomTree Energy Transition Metals and Rare Earths Miners UCITS ETF Includes companies dedicated to exploring and processing minerals used in technologies related to energy transition issues. These technologies include electric vehicles, transmission, charging, energy storage, solar, wind, and hydrogen. The index aims to provide exposure to the energy transition value chain through companies operating within important mineral categories such as lithium, nickel, cobalt, copper, iridium, aluminium, zinc, tin, silver, platinum, rare earth elements and sub-sectors such as mining, refining or smelting.
Chris Ganaty, Global Head of Research at WisdomTree, commented: “One of the key outcomes of COP28 was increased political support for moving away from carbon-intensive forms of energy, with leaders agreeing to triple renewable energy capacity by 2030. Moving to More Energy Renewable and sustainable energy sources could be the biggest driver of demand for minerals in the coming decades, and minerals such as copper, nickel, aluminium, cobalt and lithium will require higher levels of extraction so that the technologies needed to meet the climate goals set out in the Paris Agreement can be created.For example, wind turbines have been Traditionally rely on gearbox, but direct drive turbines are increasingly popular abroad, which is likely to reduce copper density, but the demand for rare earth elements will increase.At the same time, solar PV manufacturers are seeking to improve efficiency, so it is likely “With the current supply shortage, companies within the energy transition metals value chain will need to play a key role as the race to extract the most critical minerals takes center stage.”
The launch of RARE expands WisdomTree’s partnership with Wood Mackenzie and is the fifth exchange-traded product launched by WisdomTree leveraging Wood Mackenzie’s market intelligence and expertise.
Alexis Marinov, President of WisdomTree Europe, added: “RARE complements our existing suite of ETFs and ETFs focused on the energy transitionThis allows investors to allocate capital directly into critical sectors that enable the energy transition through mineral production. The new ETF is a natural extension of our European portfolio, combining our deep commodities expertise with our thematic capabilities. “Thanks to this approach, we can offer investors unique, net-equity exposure to miners involved in extracting key minerals needed for the energy transition.”
The WisdomTree Energy Transition Metals and Rare Earths Miners UCITS ETF is the latest addition to a suite of ETFs and ETFs from WisdomTree that provides investors with access to the energy transition. WisdomTree’s energy conversion portfolio consists of WisdomTree California Carbon (WCCA), WisdomTree Carbon (CARB), WisdomTree Recycling Decarbonisation UCITS ETF (WRCY), WisdomTree Battery Solutions UCITS ETF (VOLT), WisdomTree Global Automotive Innovators UCITS ETF (WCAR), and WisdomTree Renewable Energy. UCITS ETF (WRNW), WisdomTree Energy Transition Metals (WENT), and WisdomTree Battery Metals (WATT).
