For investors seeking momentum, the Xtrackers MSCI Emerging Markets Climate Selection ETF (EMCS) is probably on the radar now. The fund just hit a 52-week high and is up 48.3% from its 52-week low price of $24.18 per share.
But are there more gains in store for this ETF? Let’s take a quick look at the fund and its near-term outlook to get a better sense of where it might head.
EMCS in Focus
It offers exposure to companies with high Environmental, Social and Governance (ESG) performance relative to their sector peers. The fund charges 15 basis points (bps) in annual fees (See: All Emerging Market ETFs here).
What Led to the Rise?
Factors like favorable government policies worldwide, the declining cost of renewable technologies, increasing corporate investments, and rapid technological innovation that lowers installation costs and improves efficiency have been boosting the performance of companies promoting ESG principles, leading to stronger financial returns. With the current U.S. administrative policy changes playing against the clean energy industry’s growth prospects, more investments are pouring in the emerging nation’s renewable sector. Cumulatively, these factors might have resulted in a fresh 52-week high for EMCS.
More Gains Ahead?
EMCS may continue its strong performance in the near term, with a positive weighted alpha of 34.71 (as per Barchart.com), which suggests a further rally.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
