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Assets in equity ETFs linked to MSCI indices surge past US$1 trillion
Demand for ESG and fixed-income investment tools seen driving further growth
3 Dec 2020 | The Asset

Index provider MSCI says assets in equity exchange-traded funds (ETFs) linked to its indices have crossed the US$1 trillion mark, fuelled by strong investor demand for transparent and liquid products to access global equity markets.

The company also cites the rising focus on environmental, social and governance (ESG) and climate considerations, along with the interest in factor index-linked strategies, for the growth.

There are now more than 1,500 equity and fixed-income ESG and climate indices that use MSCI ESG Research ratings and data, and as indexed investing continues to rise, MSCI says ESG, climate, factor, thematic and fixed-income investment will mark the next stage of growth for ETF-linked exposures. There are over US$71 billion in ESG and climate equity ETF assets linked to MSCI indices, with seven of the ten largest equity ESG ETFs in the US all benchmarked to MSCI indices.

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