Key Impact Points:
- Invesco’s new MSCI North America Climate ETF (KLMN) launched on the NYSE with $2.4 billion from Finnish pension insurer Varma, setting a global record for new ETF funding.
- KLMN targets North American companies that meet environmental and climate criteria, aligning with institutional investors’ sustainable investing needs.
- Varma’s investment reflects a growing trend in thematic ETFs, which now manage over $439 billion globally.
Record-Breaking Launch
Invesco Ltd. (NYSE: IVZ), a global asset management leader, has launched the Invesco MSCI North America Climate ETF (KLMN) on the New York Stock Exchange. Backed by $2.4 billion from Varma, Finland’s pension insurer, this ETF marks the largest funding ever for a newly launched ETF worldwide.
“We are excited to collaborate once again with MSCI and Varma on a newly developed index and ETF that will allow Varma to easily execute a large allocation that aligns precisely with their investment views,” said Brian Hartigan, Global Head of ETFs & Index Investments at Invesco.
Targeting Climate-Focused Investments
KLMN tracks the MSCI Global Climate 500 North America Selection Index, which identifies North American companies from its parent index that meet specific environmental and climate standards. The ETF enables institutional clients to access large-scale, flexible, and cost-effective sustainable investments.
Varma’s Timo Sallinen, Head of Listed Securities, highlighted the alignment with Varma’s global strategy: “I am grateful to work with MSCI, a leading global index provider, as well as Invesco, one of the world’s largest asset managers, to break new ground on the launch of KLMN. Our record-breaking $2.4 billion investment… provides us with a flexible way to allocate to our precise geographical and responsible investing needs.”
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Driving Growth in Thematic ETFs
Thematic ETFs, like KLMN, continue to attract institutional investors. U.S.-listed thematic ETFs now account for over $439 billion in assets under management, fueled by demand for solutions addressing greenhouse gas and carbon emission reductions.
Christine Berg, Head of Americas Index at MSCI, emphasized the importance of custom indexing:
“We are pleased to collaborate with both Varma and Invesco to deliver an index for this ETF. The launch truly demonstrates how custom indexes can be used to support the unique views of large institutional investors.”
Varma’s success with KLMN highlights the ETF’s appeal to large investors seeking sustainability-driven allocations while leveraging liquidity and efficiency in global markets.
