NZAC Overview

Comparison of ETFs: SPDR Portfolio MSCI Global Stock Market ETF (SPGM) offers broader diversification and lower costs compared to SPDR MSCI ACWI Climate Paris Aligned ETF (NZAC), which focuses on climate-related ESG criteria.

Performance and Holdings: Both ETFs have performed similarly over the past year, with SPGM returning 16.36% and NZAC 13.5%, largely due to their common top holdings in major tech companies like Nvidia, Apple, and Microsoft.

Investment Focus: SPGM serves as a core holding for investors seeking broad market exposure, while NZAC targets those interested in sustainable investing aligned with the Paris Agreement's climate goals.

Cost and Yield: SPGM has a lower expense ratio of 0.09% compared to NZAC's 0.12%, and both funds offer similar dividend yields between 2.8% and 2.9%, appealing to cost-conscious investors.

EU Climate Ministers Meeting: European Union climate ministers are meeting in Brussels to establish a new climate change target for 2040 ahead of the UN COP30 summit in Brazil.

Proposed Emission Cuts: The European Commission has proposed a 90% reduction in greenhouse gas emissions by 2040 compared to 1990 levels, but some member states like Italy and Poland find this target too restrictive.

Support and Opposition: While countries like the Netherlands and Sweden support the ambitious target due to worsening weather conditions, others are concerned about the impact on domestic industries.

Future Adjustments and Carbon Credits: The proposal includes a clause allowing for future adjustments to the target based on forest CO₂ absorption, and member states will need to decide how much of the emissions cut can be achieved through foreign carbon credits.

Global Emissions Overview: In 2023, over half of the world's greenhouse gas emissions were attributed to just 36 companies, with state-owned enterprises contributing 52% and the top five state-owned emitters responsible for 17.4% of global emissions.

Sector Contributions: Coal remained the largest source of emissions at 41.1%, while cement production saw a significant increase in emissions, and natural gas emissions decreased by 3.7%.

Impact of U.S. Presidential Election on Energy Sector: The outcome of the U.S. presidential election is expected to significantly affect the energy sector, with Kamala Harris and Donald Trump holding opposing views on oil, gas, and renewable energy policies.

Contrasting Energy Policies: While Harris has previously supported a fracking ban and criticized oil companies, she now claims she won't ban fracking; in contrast, Trump's clear pro-drilling stance promotes increased oil production.