Investment Product and Service Launches

DWS expands Xtrackers ESG suite; Voya adds private equity investment option to NQDC offering; MSCI expands Implied Temperature Rise Metrics to funds and indexes; and more.

Voya Adds Private Equity Investment Option to its NQDC Offering

Voya Financial, Inc., has announced it has added the Pomona Investment Fund as a new option to Voya’s nonqualified deferred compensation executive-benefit solution. PIF, a registered investment vehicle providing access to private equity investing to accredited investors, is part of the Voya Investment Management product line and managed by Pomona Capital, an international private equity firm affiliated with Voya IM. PIF seeks long-term capital appreciation primarily through the purchase of secondary interests in seasoned private equity funds, by making primary commitments to private equity funds and through direct investments in opportunities alongside private equity managers.

Private equity is an asset class that is an alternative to stocks and bonds. It generally consists of equity and debt investments in companies, infrastructure, real estate and other assets. Traditionally dominated by large institutions, private equity has gained popularity in recent years in retirement programs outside of the U.S.

One reason for those gains is that, according to recent industry data, the number of public companies listed in the U.S. has declined over the past 20 years, dropping from about 5,500 in 2000 to about 4,000 in 2020. This has limited the investment opportunities for long-term savers who, in the past, may have relied on public equity markets to generate returns and achieve their retirement goals.

Participants in Voya’s NQDC executive benefit solution who choose to direct part of their investments to PIF will gain access to the professionally managed long-term multi-asset solution, including:

  • Private equity exposure for accredited investors, exposure that can complement and potentially improve the risk and reward characteristics of an investment portfolio.
  • Professional supportthrough an experienced firm with more 20 years of private equity experience navigating through multiple economic cycles.
  • Value-oriented approaches that seek long-term capital appreciation and attractive risk-adjusted returns.
  • A transparent structurethat is also user-friendly, including 1099 tax reporting and independent trustee oversight.

DWS Expands Xtrackers ESG Suite

DWS, an asset management firm, has announced the listing of three new exchange-traded funds that provide exposure to U.S. equity investment styles with ESG-screened U.S. dividend, growth and value-oriented equities.

The products, which listed on the CBOE, BZX Exchange today, are:

  • Xtrackers S&P ESG Dividend Aristocrats ETF (CBOE: SNPD)
  • Xtrackers S&P 500 Growth ESG ETF (CBOE: SNPG)
  • Xtrackers S&P 500 Value ESG ETF (CBOE: SNPV)

Xtrackers S&P ESG Dividend Aristocrats ETF seeks investment results that correspond generally to the performance, before fees and expenses, of the S&P ESG High Yield Dividend Aristocrats Index. The S&P ESG High Yield Dividend Aristocrats Index measures the performance of the index’s constituents that meet certain ESG criteria. The index also measures the performance of companies within the S&P Composite 1500 Index that have followed a policy of consistently increasing dividends every year for at least 20 years.

Xtrackers S&P 500 Growth ESG ETF and Xtrackers S&P 500 Value ESG ETF seek investment results that correspond generally to the performances, before fees and expenses, of the S&P 500 Growth ESG Index and the S&P 500 Value ESG Index, respectively. The S&P 500 Growth ESG Index and the S&P 500 Value ESG Index are broad-based, market capitalization weighted indices that provide exposure to companies with high ESG performance relative to their sector peers, while maintaining similar overall industry group weights as the S&P 500 Growth Index and the S&P 500 Value Index, respectively.

S&P’s assessment of a company’s growth characteristics is generally based on the company’s three-year net change in earnings per share over current price, the three-year sales per share growth rate, and a 12-month percentage-price-change measure of momentum. Value characteristics are generally based on the company’s book value-to-price ratio, earnings-to-price ratio and sales-to-price ratio. A scoring system is used to rank companies on a growth and value basis, with roughly the top third of companies selected for each category.

MSCI Expands Implied Temperature Rise Metrics to Funds and Indexes 

MSCI, a provider of critical decision support tools and services for the global investment community, has announced the expansion of its Implied Temperature Rise solution to cover funds and indexes, equipping equity and fixed income investors with consistent and comparable metrics to align their investment portfolios with global temperature targets.

Expanding the tool to the fund and index level gives investors access to ITR data for more than 56,000 equity and fixed income funds through the Fund Ratings Tool, as well as index level ITRs in the MSCI Index Profile Tool.

The Implied Temperature Rise solution translates the alignment of a company’s current and projected emissions, within its net-zero emissions budget, to an estimated rise in global temperature. By comparing an intuitive metric against crucial benchmarks, such as the 1.5°C objective of the Paris Agreement, the Implied Temperature Rise helps investors assess how their fund portfolios measure up to decarbonization targets and strengthen their engagement activity on the transition.

This analytical solution has been built to measure and disclose alignment of portfolios as well as target-setting frameworks as prescribed by both the Glasgow Financial Alliance for Net Zero and the Task Force on Climate-Related Financial Disclosures for all financial institutions.

John Hancock Investment Management Adds Tax-Free Income Options for Investors

John Hancock Investment Management, a company of Manulife Investment Management, has announced recent enhancements to its municipal fund suite, bringing additional flexibility to advisers and their clients seeking tax-free income opportunities and potential cost savings to shareholders.

Effective October 1, as a result of reductions to the management fees and contractual expense caps affecting the John Hancock Municipal Opportunities Fund and the John Hancock California Municipal Bond Fund, shareholders will see an immediate reduction in the funds’ overall expense ratios. The John Hancock High Yield Municipal Bond Fund is also affected by a contractual expense cap reduction.

Effective August 1, reductions were made to the eligibility requirement for investments in Class A shares with no front-end sales charge for municipal bond funds ranging from $250,000 to $1 million. This includes John Hancock Municipal Opportunities Fund, John Hancock California Municipal Bond Fund and John Hancock High Yield Municipal Bond Fund. John Hancock Short Duration Municipal Opportunities Fund was launched with a similar $250,000 eligibility. These opportunities are available at all firms where the funds are approved or available.

Effective June 9, John Hancock Investment Management announced the launch of John Hancock Short Duration Municipal Opportunities Fund. The objective of the fund is to seek total return exempt from federal income tax, as is consistent with preservation of capital.

The municipal suite is subadvised by Manulife Investment Management (U.S.) LLC, John Hancock Investment Management’s affiliated asset manager. The managers of the municipal suite of funds are Adam Weigold, senior portfolio manager and head of municipal bonds, and Dennis DiCicco, portfolio manager for municipal bonds.

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