Posted inESG

WisdomTree reveals battery solutions ETF

WisdomTree Investments has launched an equities exchange traded fund (ETF) that tracks the performance of companies primarily involved in battery and energy storage solutions.

The Battery Solutions Ucits ETF (Volt) tracks the price and net dividend performance, before fees and expenses, of the WisdomTree Battery Solutions Index (the index).

It has a total expense ratio of 0.40%.

The index was designed in collaboration between WisdomTree, a US-based exchange traded product sponsor with $59bn (€53bn) of assets under management, and Wood Mackenzie, a commercial intelligence firm for the energy, chemicals, metals and mining sector and part of US firm Verisk Analytics.

WisdomTree explained that the demand for batteries is likely to be driven mainly by a surge of electric vehicles.

Forecasts by WisdomTree and Wood Mackenzie suggest battery-powered cars are likely to grow 10-fold by 2040, with close to half of all passenger car sales becoming electric by 2040.

Selection of companies

To be eligible for inclusion in the index, a security must be involved in one or more of the following battery and energy storage solutions (Bess): raw materials, manufacturing, enablers or emerging technology.

Within each group, an intensity rating is assigned to each company which captures the perceived degree of its overall Bess involvement.

Each company from the Bess universe is also assigned a composite risk score, which is made up of quality and momentum factors, each carrying an equal weighting.

The dollar-denominated ETF is listed on the London Stock Exchange.

Rafi Aviav, head of product development, capital markets and technology, Europe at WisdomTree said that Volt “[tilts] towards the highest growth sectors”.

David Linden, director for energy transition consulting for Emearc at Wood Mackenzie, said: “This decade will be key for batteries. As they become cheaper and their deployment accelerates, they will advance the energy transition.

“Our integrated understanding of the constantly evolving battery value chain allows us to identify the sectors best positioned to take advantage of this opportunity.”

Elena Johansson

Senior Reporter

Part of the Bonhill Group.