Real Estate ETFs invest in listed real estate companies such as real estate investment trusts (REITs), providing investors with exposure to the real estate market without having to directly own physical properties. These ETFs can target both commercial and residential real estate companies, as well as various sectors like office buildings, shopping malls and industrial properties.

Real estate ETFs are appealing for investors seeking income generation through dividends and the potential for long-term capital appreciation. They also offer diversification within the real estate asset class.

Example: VanEck Global Real Estate UCITS ETF

This ETF provides exposure to listed companies involved in the real estate sector which seek a diverse set of global  investment opportunities, including residential, commercial, and industrial properties across various regions. Nonetheless, investors should note that investing in ETF is subject to risk including industry or sector concentration risk and foreign currency risk which ultimately could result in the loss of principal and must refer to ETFs documents. The decision to invest in the ETF should take into account all the characteristics or objectives of the ETF as described in the KID, the prospectus and the sustainability related disclosure or related documents before making an investment decision.

Fixed-Income ETFs provide exposure to bonds, covering a wide variety of regions, issuers, and credit ratings. These ETFs can invest in e.g., government, corporate, or municipal bonds.They can be an attractive choice for investors seeking regular income with lower volatility.

Types of Fixed-Income ETFs:

• Government bond ETFs: Focus on bonds issued by national governments, such as US Treasuries or European government bonds.
• Corporate bond ETFs: Target bonds issued by corporations, varying in terms of risk and yield depending on the issuer’s credit rating.
• High-yield bond ETFs: Invest in bonds from issuers with lower credit ratings, offering higher yields but with increased risk.

Example: VanEck iBoxx EUR Corporates UCITS ETF

This ETF provides exposure to a broad selection of corporate bonds denominated in euros, offering investors access to the European credit market with a focus on investment-grade companies. Nonetheless, investors should note that investing in ETF is subject to risk including industry or sector concentration risk and foreign currency risk which ultimately could result in the loss of principal and must refer to ETFs documents. The decision to invest in the ETF should take into account all the characteristics or objectives of the ETF as described in the KID, the prospectus and the sustainability related disclosure or related documents before making an investment decision.

Thematic ETFs typically are equity ETFs which focus on specific investment themes or trends, such as technology, renewable energy, or healthcare innovation. These ETFs allow investors to target high-growth areas or sectors that align with their interests or vision on long-term economic trends. Thematic ETFs enable investors to capitalize on emerging sectors and potential shifts in the global economy.

Some types of thematic ETFs:

• Technology ETFs: These ETFs focus on technology-driven sectors such as artificial intelligence, cybersecurity, robotics, cloud computing, and 5G. Investors can gain exposure to the tech companies at the forefront of innovation, capitalizing on the digital transformation of industries.
• Healthcare ETFs: Target e.g., biotech, pharmaceuticals, healthcare innovation, and medical device companies. Healthcare ETFs invest in firms that are leading in cutting-edge medical treatments, diagnostics and advancements in wellness technologies, which can be especially relevant in the context of an ageing population.
• ESG (environmental, social, governance) ETFs: These ETFs focus on companies that meet specific ESG criteria. They combine targeting financial returns with a commitment to positive environmental, social, and governance outcomesand might particularly appeal to socially conscious investors.

On the other hand, one common risks associated with thematic ETFs is industry and sector concentration. Economic, political or other conditions that have a negative effect on the relevant sectors or industries will negatively impact the ETF's performance.

Example: VanEck Semiconductor UCITS ETF

This ETF provides exposure to the semiconductor industry, a key component of technological innovation in sectors like electronics and renewable energy. Nonetheless, investors should note that investing in ETF is subject to risk including industry and sector concentration risk, liquidity risk and equity market risk which could result in the loss of principal and must refer to ETFs documents. The decision to invest in the ETF should take into account all the characteristics or objectives of the ETF as described in the KID, the prospectus and the sustainability related disclosure or related documents before making an investment decision.

Smart Beta ETFs use a rules-based strategy to emphasize specific factors such as market capitalization, value, growth, volatility, or financial metrics like return on equity. These ETFs combine the benefits of passive investing with an active management approach, offering a more nuanced way to capture market returns by targeting factors believed to outperform the market over time.

Types of Smart Beta ETFs:

• Factor-based ETFs: Target factors like value (low price-to-earnings ratio), growth (high earnings growth),  low volatility (investing in more stable companies), or quality ETFs (companies with strong fundamentals, such as consistent earnings growth and low debt levels).
• Equal-weight ETFs: Instead of tracking a market-capitalization-weighted index, these ETFs allocate equal weights to all constituents, which can provide different risk and return profiles.

Example: VanEck Morningstar US ESG Wide Moat UCITS ETF

This ETF invests in high quality companies with a sustainable competitive advantage, as identified by Morningstar’s proprietary "wide moat" methodology. Nonetheless, investors should note that investing in ETF is subject to risk including limited diversification concentration risk and equity market risk which could result in the loss of principal and must refer to ETFs documents. The decision to invest in the ETF should take into account all the characteristics or objectives of the ETF as described in the KID, the prospectus and the sustainability related disclosure or related documents before making an investment decision.

• Overview:
  ETCs provide exposure to commodities, often through derivatives like futures contracts, instead of owning physical assets.

• Key features:
  • Exposure to commodities: ETCs are designed to track the price movements of a specific commodity or a group of commodities, making them an effective tool for gaining exposure to the commodity markets.
  • Derivative-based tracking: Some ETCs replicate the price movement of the underlying commodities through futures contracts, swaps, or forwards. This structure allows for price exposure without the need to physically own or store the commodities, but it may introduce additional complexities such as tracking errors, rollover costs and liquidity issues.
  • Commodity types: Some ETCs focus on single commodities, like precious metals (gold, silver), energy (crude oil, natural gas), or agricultural products (corn, wheat). Others offer exposure to diversified baskets of commodities, providing broader exposure to multiple sectors within the commodity space.

• UCITS limitation:
  Unlike ETFs, which are regulated under UCITS, ETCs are not subject to the same UCITS regulations. As a result, ETCs can directly invest in commodities.

• Risk considerations:
  • Volatility: ETCs can be more volatile than ETFs because they are less diversified. If they rely on derivatives, the derivatives can experience price fluctuations that might not fully track the underlying commodity, especially during periods of high market volatility or low liquidity.
  • Rollover risk: When an ETC holds futures contracts, it may need to roll over expiring contracts into new ones. If the price of the commodity is in contango (when futures prices are higher than the spot price), this can lead to roll costs, which might erode returns over time.
  • Counterparty risk: derivative based ETCs are exposed to the risk of counterparty default, meaning that the entity providing the derivatives (such as a bank or exchange) could fail to meet its obligations. This risk is more pronounced in non-physical commodity investments, and investors should consider the financial stability of the counterparty involved.

• Liquidity: The liquidity of an ETC can vary depending on the underlying commodity and the nature of any derivative contracts used. Less liquid markets can lead to wider bid-ask spreads, impacting the cost of entry or exit from a position.

• Overview:
  ETNs are debt securities, designed to track the performance of a specific index, asset class, commodity or currency.  They promise to pay investors a return linked to the performance of the specified benchmark, minus fees. VanEck Europe has a range of ETNs that give exposure to the price movements of a range of digital assets. This allows investors to benefit from these price trends without the need to directly hold the digital assets, eliminating risks like losing private keys or storing them at unregulated entities such as crypto exchanges. The VanEck ETNs can be purchased via many banks and brokers and are traded on regulated exchanges.

• Risk Considerations:
  • Credit risk: Some ETNs are unsecured debt securities, that means that their value is tied to the financial stability of the issuer. If the issuing institution defaults, investors may lose some or all of their investment, regardless of the performance of the underlying benchmark. The digital asset ETNs that are issued by VanEck are collateralized, meaning that the cash is invested in the underlying digital assets, which reduces the credit risk.
  • Market volatility: ETN prices are influenced by market demand, liquidity and sentiment, which may result in price fluctuations. Digital assets have been known for extreme volatility.
  • Liquidity risk: The liquidity of ETNs depends on both the underlying benchmark and the market demand for the specific note. Less liquid ETNs may have wider bid-ask spreads, making it more expensive to buy or sell the security.
  • Fees and costs: ETNs often involve management fees and issuer-related costs, which can reduce overall returns over time. Investors should review the fee structure carefully before investing.

• Regulatory considerations: ETNs are not subject to UCITS regulations, which means they lack some of the investor protections provided to ETFs in Europe. This makes it particularly important for investors to assess the structure and creditworthiness of the issuer and understand the risks associated with the underlying benchmark.

• Example: The VanEck Bitcoin ETN is an example of an ETN that provides exposure to Bitcoin’s price movements. The ETN allows investors to have exposure to the performance of Bitcoin without directly owning or storing the cryptocurrency. However, as with all ETNs, the credit risk of the issuer and the volatility of Bitcoin's price movements are key considerations for investors.