NEW
YORK, Oct. 13, 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
Electrification Metals ETF (Ticker: KMET) on the New York Stock
Exchange today.
KMET offers broad coverage of the key metals needed for the
electrification of the global economy. The Fund tracks the
Bloomberg Electrification Metals Index, which is comprised of
futures contracts on aluminum, copper, nickel, zinc, cobalt, and
lithium. As the economy decarbonizes, we expect to see massive
demand for renewable energy, electrification, and battery storage.
More than $140 trillion of investment
is needed for the clean energy transition over the next thirty
years.1
From Electric Vehicles (EVs) and batteries to renewable energy
infrastructure, KMET offers exposure to the core metals expected to
see strong demand from a range of electrification uses. Increased
EV adoption has led to a growing demand for batteries, the key
components of which include lithium, nickel, zinc, and cobalt. From
2020-2025, the global battery market could see a nearly five-fold
increase in demand.2 While still a relatively new
market, EV battery production is well-positioned to be a major
growth opportunity for these metals as we continue to improve and
streamline the battery supply chain.
Beyond batteries, copper and aluminum will also play an
important role in the electrification of the global economy.
Aluminum, a durable, lightweight material, can offset the weight of
the EV's larger battery and should see increased demand from the
expansion of the EV market. Additionally, aluminum has application
use in transmission and distribution grids and as a key material in
solar panels and wind turbines. Among the most conductive metals,
copper is used extensively for electrical wiring. EVs require more
than twice as much copper than traditional cars.3
Moreover, copper is a core element in the wiring and cabling for
various renewable energy technologies.
"Transitional commodities are expected to experience a supply
and demand imbalance over the next decade," said Luke Oliver, Head of Strategy at KraneShares.
"These resources may be repriced depending on how they factor into
the decarbonization of the global economy. We believe now is the
time to invest in these electrification metals as demand is poised
to accelerate into the energy transition."
"KMET is a timely expansion of the KraneShares Climate
Investment suite, which has quickly evolved from our flagship
KraneShares Global Carbon Strategy ETF (Ticker: KRBN) to include
regional carbon markets, energy transition equities, and now
electrification metals," said Jonathan
Krane, Chief Executive Officer at KraneShares. "We believe
investors should have direct access to the global decarbonization
investment opportunity. We are proud to launch the KraneShares
Electrification Metals ETF (Ticker: KMET), which provides unique
exposure to a key component of this opportunity and furthers
KraneShares' leadership in the space."
"Our goal has always been to push development forward in
providing new solutions for the world's changing investment
demands," said Dave Gedeon Head of
Product for Bloomberg's Multi-Asset Index business. "Integrating
unique research data alongside our established Bloomberg Commodity
Benchmark, we are proud that KraneShares has adopted our
electrification metals index for KMET to meet the thematic demand
across the changing commodity markets."
For additional information on the KraneShares Electrification
Metals ETF (Ticker: KMET), contact your financial advisor or visit
kraneshares.com/KMET.
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 growth area. 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).
Citations:
- International Renewable Energy Agency (IRENA). Forecast as of
June of 2021. Data retrieved 5/31/2022.
- S&P Global Market Intelligence, EV Impact: Battery
disruptors are jolting metal supply chains, September 21, 2021
- Reuters, "Copper's Role in Growing Electric Vehicle
Production," May 5, 2021, retrieved
9/22/2021.
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 Fund may invest in derivatives, which are often more
volatile than other investments and may magnify the Fund's 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. The Fund is subject to liquidity risk, meaning
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. 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 its 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.
In addition to the risks associated with commodities,
investments in metals may be highly volatile and can change quickly
and unpredictably due to the supply and demand of each metal,
environmental or labor costs, political, legal, financial,
accounting, and tax matters, and other events that the Fund cannot
control. Changes in international monetary policies or economic and
political conditions can affect the value of metal investments. The
principal supplies of metal industries may be concentrated in a few
countries and regions, causing the metal price to decline and
materially impact the Fund's performance. The metals the Fund will
gain exposure to are considered industrial metals and may be
subject to several additional factors which might cause price
volatility. These may include changes in the level of industrial
activity using industrial metals, supply chain disruptions,
adjustments to inventory, variations in production costs, costs
associated with regulatory compliance, and changes in industrial,
government, and consumer demand.
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 a sector, industry, market, or group of
concentrations to the extent that the Underlying Index has such
concentrations. The securities or futures in that concentration
could react similarly to market developments. Thus, The Fund is
subject to loss due to adverse occurrences that affect that
concentration. KMET is non-diversified.
The Fund is new and does not yet have a significant number of
shares outstanding. If the Fund does not grow in size, it will be
at greater risk than larger funds.
Fund 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. 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. NAVs are calculated using prices as of 4:00 PM Eastern Time.
Although the information provided in this document has been
obtained from sources which Krane Funds Advisors, LLC believes to
be reliable, it does not guarantee accuracy of such information and
such information may be incomplete or condensed.
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.
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SOURCE Krane Funds Advisors, LLC