Risks of a Circular Economy ETF: You may lose money up to the total loss of your investment due to the Main Risk Factors, such as Industry or Sector Concentration Risk and Liquidity Risks described below, in the KID and in the sales prospectus. Evolving of the market not guaranteed.
Our take-make-waste economy consumes almost 100 billion tons of materials a year and wastes over 90% of those1. Over 70% of global waste is still being disposed of in landfills, 33% of it managed through “open dumping”2. VanEck’s Circular Economy UCITS ETF invests in companies at the forefront of planet’s battle with waste by enabling recycling and reuse-related solutions and producing goods from recycled materials.
1 Circularity Gap Report 2022
Circular Economy does not only help the planet, but can also carry tangible economic benefits for companies that implement resource-efficient productions. British Metals Recycling Association estimates that using steel scrap in the production process reduces carbon emissions by 58% and saves 72% of the energy compared to production from raw resources. At the same time, recycled aluminium and copper require 95% and 85% less energy respectively, compared to primary material production.
Circular Economy also offers opportunities for companies willing to adjust their supply chain or contribute resource-efficient services and raw materials for production. Such activities are not limited to recycling itself, but can also include sustainable design, sourcing, usage optimization as well as platforms enabling reuse and redistribution of goods.
Through investment in companies, active in the fields of Waste Management, Water Purification and Treatment, Biofuels, and Services and Goods related to recirculated materials and products, the VanEck Circular Innovators UCITS ETF aims to provide exposure to companies contributing to various forms resource efficiency. Below you can find examples of companies comprising Circular Economy ETF.
Darling Ingredients Inc. collects and recycles animal processing by-products and used restaurant cooking oil. The Company also provides grease trap collection services to restaurants. Darling processes such raw materials into finished products such as tallow, meat and bone meal, and yellow grease for sale in the United States and overseas.
Kurita Water Industries Ltd. manufactures, sells, and maintains water treatment equipment and systems. The Company's products include water purification and wastewater treatment equipment as well as soil remediation systems. Kurita also manufactures and sells chemicals for water treatment related to sanitation, air-conditioning and construction.
Waste Management Inc. provides waste management services including collection, transfer, recycling, resource recovery, and disposal services, and operates waste-to-energy facilities. The Company serves municipal, commercial, industrial, and residential customers throughout North America.
UPM is a Finnish company manufacturing forestry products. The Company focuses on fine and specialty papers, siliconized papers, industrial wrappings, packaging and biofuels with a significant share of raw materials coming from recycled fiber.
Tomra Systems ASA develops, manufactures, and markets recycling machines. The Company's solutions are used for automated waste and metal sorting, as wells as reverse vending (bottle collection) machines using sensors, X-rays and object recognition.
Brambles Limited is a global logistics company, which provides pallet and plastic container pooling services. Brambles provides standardised pallets, crates and containers to customers, who use this equipment and Brambles’ support services to transport goods through the supply chain. Customers either arrange for the equipment’s return to Brambles or transfer it to another participant for reuse.
Befesa SA provides hazardous waste recycling services. The company is active in steel dust and aluminium salts recycling, whereby it collects waste from its clients, recycles it and reintroduces as raw materials to the market.
Umicore SA is a materials technology company. The company operates metals and advanced materials recycling facilities. Umicore works with metals, that are crucial for the carbon-free energy transition, including, but not limited to, copper, cobalt, lithium and rare earths.
Lower risk: Typically lower reward
Higher risk: Typically higher reward
Exists when a particular financial instrument is difficult to purchase or sell. If the relevant market is illiquid, it may not be possible to initiate a transaction or liquidate a position at an advantageous or reasonable price, or at all. This is a factor to consider when investing in a Circular Economy ETF.
The prices of the securities in the Fund are subject to the risks associated with investing in the securities market, including general economic conditions and sudden and unpredictable drops in value. An investment in the Fund may lose money.
The Fund’s assets may be concentrated in one or more particular sectors or industries. Circular Economy ETF may be subject to the risk that economic, political or other conditions that have a negative effect on the relevant sectors or industries will negatively impact the Fund's performance to a greater extent than if the Fund’s assets were invested in a wider variety of sectors or industries.
For more information on risks, please see the “Risk Factors” section of the relevant Fund’s prospectus, available on www.vaneck.com.