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Franklin Templeton has announced the launch of its new UCITS ETF, offering European investors access to cutting-edge companies across the metaverse.
The firm writes that the metaverse is a forward-looking, shared virtual and mixed reality, powered by digital technologies. As an interactive and immersive space, the metaverse is expected to influence many aspects of people’s lives – including how they interact, socialise, learn, shop, work and play virtually. It combines aspects of social media, online gaming and augmented virtual reality and is widely regarded as the next iteration of the internet as we currently know it, merging our digital lives seamlessly.
Dina Ting, Head of Global Index Portfolio Management, Franklin Templeton says: “Society has already experienced three foundational changes in the way that technology operates and how it’s been delivered since the early 1970s. This exciting fourth wave is now emerging, enabled by blockchain technology.
“Many big tech companies have already pivoted towards the metaverse for their next major area of development in the same way that many did at the inception of the internet. There appear to be tremendous real-world business opportunities for investment in this space considering that by 2030, the e-commerce market could grow between USD2.0–USD2.6 trillion.
“Blockchain technology development is propelling metaverse expansion possibilities in compelling and far-reaching ways. We believe that investment in the metaverse and its rising sophistication bode well for the next iteration of the internet, which could profoundly impact societies and global economic growth.”
The Franklin Metaverse UCITS ETF tracks the Solactive Global Metaverse Innovation Net Total Return Index comprised of global equity securities issued by companies that have, or are expected to have, significant exposure to the metaverse and supporting blockchain technologies. Companies that are deemed to not align with UN Global Compact Principles are excluded from the index.
This new ETF will list on the Deutsche Börse Xetra (XETRA) on 7 September, and the Borsa Italiana and London Stock Exchange (LSE) on 9 September. The ETF will be registered in the UK, Austria, Denmark, Finland, France, Germany, Ireland, Italy, Spain and Sweden. It will be managed by Dina Ting, Head of Global Index Portfolio Management, and Lorenzo Crosato, ETF Portfolio Manager at Franklin Templeton.
Caroline Baron, Head of ETF Business Development, EMEA, Franklin Templeton says: “The metaverse is expected to grow to USD5 trillion in value by 2030 and, to capture this exciting growth opportunity, we have partnered with German-based index provider Solactive AG to develop a distinct ETF backed by the scale and resources of Franklin Templeton.
“Headquartered in the heart of innovation, Silicon Valley, our firm is a leader in thematic and technology investing. We are delighted to be an early mover in this space and thus provide European investors with access to a diversified pool of cutting-edge companies across the key metaverse segments at a low cost. The new ETF allows investors to diversify their core holdings and satellite thematic sleeves in their existing portfolios with a unique exposure and participate in the expected secular growth of the underlying megatrend that is digitisation.”
The firm writes that the ETF will provide European investors with cost-efficient, UCITS-compliant metaverse exposure and the lowest total expense ratios (TER5) at 0.30 per cent in Europe (TER is on average 50 per cent lower than other metaverse UCITS ETFs).