NEW
YORK, April 27, 2022 /PRNewswire/ -- Krane Funds
Advisors, LLC ("KraneShares"), an asset management firm known for
its global exchange-traded funds (ETFs) and innovative investment
strategies, announced the launch of the KraneShares Global Carbon
Offset Strategy ETF (Ticker: KSET) on the New York Stock Exchange
today.
KSET offers broad coverage of the voluntary carbon market by
tracking carbon offset futures contracts. These futures contracts
include nature-based global emission offsets (N-GEOs) and global
emission offsets (GEOs), which trade through the CME Group, the
world's largest financial derivatives exchange. KSET will
dynamically add additional offset markets as they reach scale.
According to CME Group, N-GEO futures follow the
industry-leading Verified Carbon Standard (VCS) requirements for
Agriculture, Forestry, and Other Land Use (AFOLU) projects.
Additionally, N-GEOs require certification from the Verra
Registry's stringent Climate Community and Biodiversity (CCB)
Standard, which identifies projects that simultaneously address
climate change, support local communities and smallholders, and
conserve biodiversity. GEOs are offsets that meet Carbon Offsetting
and Reduction Scheme for International Aviation (CORSIA) criteria
from the VCS, Climate Action Reserve, or American Carbon
Registry.1
"KSET is a timely expansion of the KraneShares Climate
Investment suite, which includes the $1.4bn KraneShares Global Carbon Strategy ETF
(KRBN), to now cover both compliance and voluntary carbon markets,"
said Luke Oliver, KraneShares Head
of Strategy. "KSET's addition to the suite gives investors holistic
access to global decarbonization efforts and continues KraneShares'
leadership in the space."
"Voluntary Carbon markets are a vital
tool in the fight against climate change and are increasingly
viewed as a cornerstone in global efforts to achieve
mid-century net-zero targets," said Eron Bloomgarden, co-founder of Climate Finance
Partners (CLIFI) KSET's non-discretionary sub-advisor. "Investors
can feel confident that the offset credits behind
KSET are generated from emission reduction activities
that have been third-party verified by leading carbon offset
registries."
What are Carbon Offsets?
Carbon offsets are created through emission reductions
activities that have been developed and verified to third-party
standards. These offsets are used to mitigate residual
and hard-to-abate emissions that corporations, governments,
or individuals generate as part of their ongoing
activities. The governing bodies tasked with overseeing the
verification of carbon offset projects are called carbon offset
registries. These registries issue credits for emission-reducing
projects such as forest conservation, the creation of wind farms,
methane gas capture in a landfill, and renewable and energy
efficiency projects. Credits are issued
proportionate to the amount of greenhouse gas (GhG) emissions an
activity removes, avoids, or reduces. Buyers of offsets should
first reduce their own Scope 1, 2, and 3 emissions and then
purchase a corresponding quantity of credits to offset their
residual emissions. Entities often utilize offsets as a short-term
bridge while they work on implementing longer-term decarbonization
measures.
"KSET is the first US-listed ETF to combine the leading carbon
offset futures markets into a single investable fund2,"
said Jonathan Krane, Chief Executive
Officer at KraneShares. "We are pleased to offer KSET as a key
addition to our growing climate suite."
For additional information on the KraneShares Global Carbon
Offset Strategy ETF (Ticker: KSET), contact your financial advisor
or visit kraneshares.com/KSET.
About Krane Funds Advisors, LLC
Krane Funds Advisors, LLC is the investment manager for KraneShares
ETFs. KraneShares is a premier platform that develops and delivers
differentiated, high-conviction investment strategies to global
investors.
Since 2013, KraneShares has become one of the leading China ETF
providers. Given China's
importance in addressing the global climate challenge, our Climate
Suite is a natural extension of our China focus. KraneShares strives to deliver
innovative first-to-market strategies based on strong partnerships
and deep investing knowledge. KraneShares helps investors stay
current on global market trends and provides meaningful
diversification.
Krane Funds Advisors, LLC, is a signatory of the United
Nations-supported Principles for Responsible Investing
(UN PRI). The firm is majority-owned
by China International Capital Corporation (CICC).
About Climate Finance Partners
Climate Finance
Partners delivers innovative climate finance solutions and
investment products to scale capital in to climate impact. CLIFI is
an impact focused investment firm and is led by a team of
professionals with deep experience in the fields of investment and
environmental and climate finance.
Citations:
- CME Group, "CBL Nature-Based Global Emissions Offset (N-GEO)
and CBL Global Emissions Offset (GEO) Futures ‒ Frequently Asked
Questions," Jun 21 2021
- Data from Bloomberg as of 4/25/2022
Carefully consider the Fund's investment objectives, risk
factors, charges, and expenses before investing. This and
additional information can be found in the Fund's full and summary
prospectus, which may be obtained by visiting www.kraneshares.com
Read the prospectus carefully before investing.
Risk Disclosures:
Investing involves risk, including
possible loss of principal. There can be no assurance that a Fund
will achieve its stated objectives. Indices are unmanaged and do
not include the effect of fees. One cannot invest directly in an
index.
This information should not be relied upon as research,
investment advice, or a recommendation regarding any products,
strategies, or any security in particular. This material is
strictly for illustrative, educational, or informational purposes
and is subject to change. Certain content represents an assessment
of the market environment at a specific time and is not intended to
be a forecast of future events or a guarantee of future results;
material is as of the dates noted and is subject to change without
notice.
The market for carbon offset credit futures may be less
developed, and potentially less liquid and more volatile, than more
established futures markets. While the market has grown, there can
be no assurance that this growth will continue. The price for
carbon offset credit futures is based on a number of factors,
including the supply of and the demand for carbon offset credit
futures as well as the supply and demand for carbon offset credits.
The performance of carbon offset credit futures and carbon offset
credits may differ and may not be correlated with each other, over
short or long periods of time. There is no assurance that cap and
trade regimes will continue to exist, or that they will prove to be
an effective method of reduction in GHG emissions. Changes in U.S.
law and related regulations may impact the way the Fund operates,
increase Fund costs and/or change the competitive landscape. New
technologies may arise that may diminish or eliminate the need for
cap and trade markets. Ultimately, the cost of emissions credits is
determined by the cost of actually reducing emissions levels. If
the price of credits becomes too high, it will be more economical
for companies to develop or invest in green technologies, thereby
suppressing the demand for credits.
The Fund invests through a subsidiary, and is indirectly exposed
to the risks associated with the Subsidiary's investments. Since
the Subsidiary is organized under the law of the Cayman Islands and is not registered with the
SEC under the Investment Company Act of 1940, as such the Fund will
not receive all of the protections offered to shareholders of
registered investment companies. The Fund and the Subsidiary will
be considered commodity pools upon commencement of operations, and
each will be subject to regulation under the Commodity Exchange Act
and CFTC rules. Commodity pools are subject to additional laws,
regulations and enforcement policies, which may increase compliance
costs and may affect the operations and performance of the Fund and
the Subsidiary. Futures and other contracts may have to be
liquidated at disadvantageous times or prices to prevent the Fund
from exceeding any applicable position limits established by the
CFTC. The value of a commodity-linked derivative investment
typically is based upon the price movements of a physical commodity
and may be affected by changes in overall market movements,
volatility of the Index, changes in interest rates, or factors
affecting a particular industry or commodity.
The Fund and the Subsidiary will be considered commodity pools
upon commencement of operations, and each will be subject to
regulation under the Commodity Exchange Act and CFTC rules.
Commodity pools are subject to additional laws, regulations and
enforcement policies, which may increase compliance costs and may
affect the operations and performance of the Fund and the
Subsidiary. Futures and other contracts may have to be liquidated
at disadvantageous times or prices to prevent the Fund from
exceeding any applicable position limits established by the CFTC.
The value of a commodity-linked derivative investment typically is
based upon the price movements of a physical commodity and may be
affected by changes in overall market movements, volatility of the
Index, changes in interest rates, or factors affecting a particular
industry or commodity. The Fund may invest in derivatives, which
are often more volatile than other investments and may magnify the
Funds' gains or losses. A derivative (i.e., futures/forward
contracts, swaps, and options) is a contract that derives its value
from the performance of an underlying asset. The primary risk of
derivatives is that changes in the asset's market value and the
derivative may not be proportionate, and some derivatives can have
the potential for unlimited losses. Derivatives are also subject to
liquidity and counterparty risk. Liquidity risk means that certain
investments may become difficult to purchase or sell at a
reasonable time and price. If a transaction for these securities is
large, it may not be possible to initiate which may cause the Fund
to suffer losses. Counterparty risk is the risk of loss in the
event that the counterparty to an agreement fails to make required
payments or otherwise comply with the terms of derivative.
The use of futures contracts is subject to special risk
considerations. The primary risks associated with the use of
futures contracts include: (a) an imperfect correlation between the
change in market value of the reference asset and the price of the
futures contract; (b) possible lack of a liquid secondary market
for a futures contract and the resulting inability to close a
futures contract when desired; (c) losses caused by unanticipated
market movements, which are potentially unlimited; (d) the
inability to predict correctly the direction of market prices,
interest rates, currency exchange rates and other economic factors;
and (e) if the Fund has insufficient cash, it may have to sell
securities or financial instruments from its portfolio to meet
daily variation margin requirements, which may lead to the Fund
selling securities or financial instruments at a loss.
Fluctuations in currency of foreign countries may have an
adverse effect to domestic currency values. The Fund is subject to
interest rate risk, which is the chance that bonds will decline in
value as interest rates rise. Narrowly focused investments
typically exhibit higher volatility. The Fund's assets are expected
to be concentrated in carbon offset credit futures and carbon
credit futures and its investments could react similarly to market
developments. Thus, the Fund is subject to loss due to adverse
occurrences that may affect these futures. KSET is
non-diversified.
ETF shares are bought and sold on an exchange at market price
(not NAV) and are not individually redeemed from the Fund. However,
shares may be redeemed at NAV directly by certain authorized
broker-dealers (Authorized Participants) in very large
creation/redemption units. The returns shown do not represent the
returns you would receive if you traded shares at other times.
Shares may trade at a premium or discount to their NAV in the
secondary market. Brokerage commissions will reduce returns.
Beginning 12/23/2020, market price returns are based on the
official closing price of an ETF share or, if the official closing
price isn't available, the midpoint between the national best bid
and national best offer ("NBBO") as of the time the ETF calculates
the current NAV per share. Prior to that date, market price returns
were based on the midpoint between the Bid and Ask price. NAVs are
calculated using prices as of 4:00 PM
Eastern Time.
The KraneShares ETFs, KFA Funds ETFs, and KraneShares Mutual
Funds are distributed by SEI Investments Distribution Company
(SIDCO), 1 Freedom Valley Drive, Oaks,
PA 19456, which is not affiliated with Krane Funds Advisors,
LLC, the Investment Adviser for the Fund.
[R_US_KS_SEI]
View original
content:https://www.prnewswire.com/news-releases/kraneshares-launches-first-us-listed-global-carbon-offset-etf-nyse-kset-301533811.html
SOURCE Krane Funds Advisors, LLC