Europe’s first ESG-focused gold mining ETF to launch on LSE this month

Europe’s first gold mining exchange traded fund (ETF) with an ESG-focused mandate will launch on the London Stock Exchange (LSE) this month.

The AuAg ESG Gold Mining UCITS ETF tracks an index that ranks gold miners for ESG characteristics and only includes the sector’s 25 ‘best in class’ companies for ESG risk, based on screening from independent specialists Sustainalytics.

Created in partnership with boutique precious metals and green tech-focused AuAg Funds, the ETF will allow ESG-focused investors a unique opportunity to participate in the gold mining sector.

The fund is equally weighted, with each holding having an allocation of 4%. The equal-weighted design helps to avoid concentration risks in larger gold miners.

However, the possible underweighting of a few dominant mega-companies may also provide a beneficial return profile for the AuAg ESG Gold Mining UCITS ETF in a bull market for gold and gold miners.

“We’re delighted to launch the AuAg ESG Gold Mining UCITS ETF (ESGO) which allows investment in the companies that extract precious metals, with an active ESG approach,” said AuAg chief executive Eric Strand.

“Mining is an industry that has seen vast improvements in all aspects of ESG, but standards vary across regions and companies. ESGO helps investors get exposure towards gold mining companies with the best ESG credentials and invest in the sector more responsibly.”