ESG data is coming to the U.S. – ASAP.
North American Investors and traders interested in gaining exposure to Environmental Social and Governance (ESG) markets are about to gain a competitive advantage thanks to Nasdaq via its recent alliance with TrackInsight. TrackInsight (www.trackinsight.com) is a leading global independent ETF analytics platform that operates a global platform dedicated to ETF search, analysis and selection aimed at professional investors.
TrackInsight currently has over 100,000 unique users and 2,500 qualified professional investors using its platform for their day-to-day ETF screening; it is recognized as the leading source of independent and reliable information for more than 6,000 Exchange Traded Funds listed globally.
According to market data, there are currently 87 ESG ETF products tracking roughly $16 billion in the U.S. — a mere fraction of the nation’s $4 trillion total ETF assets and well below Europe’s $124 billion ESG ETF business. More data should translate into more trading and innovation, the thinking goes.
BlackRock recently launched a suite of four asset allocation ESG ETFs. Similar to BlackRock’s existing four asset allocation ETFs, which launched in 2008 and have since accumulated over $4 billion in assets, these new funds are tailored for different investor risk appetites ranging from ‘Conservative’ to ‘Aggressive.’
And BlackRock isn’t the only mega asset manager offering ESG ETFs – Vanguard, Putnam and State Street Global Advisors are also. And more are to follow as newer and younger investors seek these socially-conscious investments.
Morningstar has written that sustainable funds in the United States attracted new assets at a record pace in 2019. It estimated net flows into open-end and exchange-traded sustainable funds that are available to U.S. investors totaled $20.6 billion for the 2019.
So, there is a need for the data and now.
The TrackInsight ESG data offerings now available in North America include “TrackInsight Global View,” a unique data service designed to provide professional investors with verified ETF reference data as well as advanced metrics on investment-related considerations such as ESG transparency, style exposure, liquidity, performance, risk and replication accuracy analysis. Global View is a comprehensive source of daily global ETF inflows and used by various firms such as hedge funds, portfolio managers, research institutions and fund promoters.
“If you look at how ESG ETF assets are being raised globally, you see that Europe started sooner with this, but in America it’s picking up really fast,” said Jean-René Giraud, founding C.E.O. of TrackInsight. He stressed that this initiative represents a major milestone and brings a very innovative service to the buy and sell sides of the ETF ecosystem.
“It isn’t that difficult to collect ESG data, the challenge is really that there are a number of competing methodologies out there trying to define what constitutes ‘ESG’, and investors struggle with that,” he added.
Oliver Albers, SVP and Head of Data for Nasdaq’s Global Information Services added that both TrackInsight and Nasdaq are focused on making markets more accessible through transparent and cost-effective data. This data serves a multitude of strategies, including ESG.
“Technology and data have made investing easier and more cost-effective than ever before, and this has dovetailed with increased investor demand for ESG products and data,” Albers told Traders Magazine. “Our distribution of TrackInsight ETF data is a great way to provide additional transparency and insights to more investors to help them grow and diversify their portfolios in a cost-effective way.”
TrackInsight Global View will be made available to Nasdaq customers through Nasdaq’s Quandl platform, which provides a robust source of core and alternative data and also offers Nasdaq Cloud Data Service via its storefront.
Launched in 2014, TrackInsight supports the ETF selection process of 27 of the 50 largest ETF allocators in the world.
