Invesco MSCI North America Climate ETF Breaks Records with Launch of KLMN Investment Fund

Invesco Launches the Invesco MSCI North America Climate ETF (KLMN)

On December 12, 2024, Invesco Ltd., a prominent player in global asset management, announced its latest investment vehicle — the Invesco MSCI North America Climate ETF, symbolized as KLMN. This fund is particularly noteworthy as it commenced trading on the New York Stock Exchange with a staggering $2.4 billion in assets, thanks to investment from Finnish pension insurer Varma. This amount sets a new global benchmark for the capital raised during a new ETF launch.

Brian Hartigan, Invesco's Global Head of ETFs & Index Investments, expressed enthusiasm about the partnership with Varma and MSCI, emphasizing that the new ETF provides a remarkable opportunity for large institutional investors seeking to align their portfolios with significant environmental goals. He stated, "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."

The KLMN ETF is designed to track the MSCI Global Climate 500 North America Selection Index. This index is crafted specifically to highlight companies within North America featured in the broader MSCI ACWI Select Climate 500 Index. The selection process for the index incorporates criteria that emphasize the environmental and climate accountability of companies, aiming to favor organizations that are proactive in reducing their greenhouse gas emissions.

Varma’s involvement does not merely add capital; it aligns seamlessly with their sustainable investment strategy. As Timo Sallinen, Varma's Head of Listed Securities, remarked on the investiture, the firm aims to combine flexibility with responsible investing needs, thus reflecting a comprehensive commitment to sustainability.

The growing popularity of thematic ETFs, particularly those focusing on critical issues such as climate change, cannot be overstated. With more than $439 billion managed within U.S. listed thematic ETFs as of the end of 2024, this sector is poised for considerable expansion, appealing to institutions striving for liquid, efficient, and cost-effective investment allocations.

Christine Berg, who leads the Americas Index team at MSCI, affirmed the importance of customized indexes, stating that the launch of KLMN showcases how bespoke index solutions can cater to the diverse needs of institutional investors. This partnership exemplifies the innovative approaches necessary to meet the demands of today’s socially conscious investors.

Invesco Ltd. has been at the forefront of asset management, guiding its strategies to align with global investment trends. As of September 30, 2024, the firm managed assets worth approximately $1.8 trillion across various global markets. Its dedicated approach to both active and passive investment strategies allows it to meet the diverse needs of its clientele.

As the landscape of investing continues to evolve, the introduction of the Invesco MSCI North America Climate ETF signifies not only a new record in asset allocation for new ETFs but a powerful intersection of finance and environmental stewardship. Investors are becoming increasingly aware of the importance of their investment choices, and funds like KLMN cater to a growing demand for financial products that prioritize sustainability.

For potential investors, it is essential to understand the inherent risks associated with ETF investments, including market volatility and the general characteristics of the asset class. As with any investment, careful consideration and due diligence are advised before entering the market.

In conclusion, Invesco, through its innovative ETF solutions, stands as a beacon of adaptability and forward-thinking in the investment management world, embracing the challenge of marrying profitability with sustainability.