Core Viewpoint - A new ETF is focusing on climate risk as a significant factor influencing real estate returns, highlighting the increasing importance of this risk in financial evaluations [1]. Group 1: Market Context - Rising insurance costs and coverage withdrawals in high-risk regions are making climate exposure a mainstream financial concern [2]. - Extreme weather events are contributing to the urgency of addressing climate risk in investment strategies [2]. Group 2: ETF Features - The ETF utilizes catastrophe modeling from Moody's, applying risk frameworks typically used by insurers to public equity investing [2]. - The aim is to identify Real Estate Investment Trusts (REITs) that are better positioned to withstand climate-related shocks [2]. - This ETF represents a shift in portfolio construction, moving climate risk from a theoretical concern to a measurable and investable factor [3].

Core Insights - The State Street SPDR MSCI ACWI Climate Paris Aligned ETF (NZAC) and iShares Core MSCI Total International Stock ETF (IXUS) differ significantly in market coverage, sector tilt, and ESG focus, with IXUS providing a higher yield and greater scale [1][4] Cost & Size Comparison - NZAC has an expense ratio of 0.12% and assets under management (AUM) of $173.0 million, while IXUS has a lower expense ratio of 0.07% and AUM of $57.6 billion [3] - The one-year return for NZAC is 18.0%, compared to 34.7% for IXUS, and the dividend yield for NZAC is 1.9%, while IXUS offers a higher yield of 3.0% [3] Performance & Risk Analysis - Over five years, NZAC has a maximum drawdown of -28.31%, while IXUS has a slightly higher drawdown of -30.05% [5] - The growth of $1,000 over five years is $1,455 for NZAC and $1,333 for IXUS, indicating better performance for NZAC in this period [5] Holdings Overview - IXUS holds over 4,100 international stocks, with significant allocations in financial services (21%), industrials (15%), and basic materials (13%), featuring major stakes in companies like Taiwan Semiconductor Manufacturing, Samsung Electronics, and ASML [6] - NZAC is more concentrated with 678 holdings, heavily tilted towards technology (34%), and its top holdings include Nvidia, Apple, and Microsoft, reflecting a tech-heavy and U.S.-centric focus [7] Investment Implications - Both ETFs have strong performance histories and could serve as valuable components in a diversified portfolio, with NZAC appealing to investors focused on climate risk due to its ESG screen [8] - NZAC has returned 18.5% over the past year, with a five-year annualized return of 10.8% and a ten-year annualized return of 12.2%, indicating robust long-term performance [9]

Group 1: Industry Developments - Bed Bath & Beyond is acquiring Tokens.com to develop a blockchain-based investment and personal finance platform, integrating tools from tZERO and Figure for services like mortgages and renovation loans [1] - The IMB Conference highlighted that lenders must evolve beyond being mortgage-only shops, emphasizing the importance of servicing as a strategic advantage to strengthen trust and retention [5] - The conference agenda included discussions on regulatory and market outlook, consolidation trends, technology ROI, and strategic bets shaping the next cycle for independent mortgage bankers (IMBs) [8][9] Group 2: Technology and Innovation - Truework offers a comprehensive income and employment verification platform that automates verification processes for mortgage lenders, resulting in up to 50% cost savings [2] - The rise of AI tools among Gen-Z borrowers indicates a shift in trust away from traditional banks and loan officers, with trust in banks dropping from 61.5% to 40% and loan officers to 19.5% [2] - MCT's upcoming webinar on trending credit scores will explore how new credit data can influence risk evaluation and pricing strategies in capital markets [3] Group 3: Market Trends and Challenges - The frequency and severity of extreme weather events are increasing, leading to rising insurance premiums that have nearly doubled since 2014, impacting housing affordability and introducing credit risks [5] - Job cuts in the U.S. reached 108,435 in January, a 118% increase from the previous year, indicating potential economic challenges ahead [17] - The Bank of England and European Central Bank maintained their interest rates, reflecting a cautious approach amid broader economic uncertainties [16][17]

Investment Rating - The report does not explicitly provide an investment rating for the transport resilience sector, but emphasizes the critical need for investment prioritization and resource allocation to enhance road network resilience against climate hazards [17][18]. Core Insights - Road networks are essential for economic growth and social well-being, but they face increasing risks from aging infrastructure and climate change, necessitating adaptation investments projected to exceed hundreds of billions annually by 2030 [17][18]. - Effective transport resilience analysis has evolved into practical, scalable approaches that can be applied even in data-limited contexts, focusing on multidimensional risks at asset, system, and user levels [18][19]. - The report identifies two key analytical tools: the Global Resilience Index (GRI) for rapid vulnerability assessments and the Hazard & Risk Multi-Regional Assessment (HARMA) for in-depth economic analysis of climate impacts on transport networks [21][22]. Summary by Sections Executive Summary - The report highlights the increasing vulnerability of road networks to climate hazards and the urgent need for strategic investment in resilience measures [17][18]. - It outlines a common sequence of analytical steps for transport resilience assessments, emphasizing the importance of integrating economic analysis into prioritization efforts [19][20]. Resilience Assessment Methodology and Tools - The methodology for resilience assessments includes defining the scope, identifying climate hazards, and employing a five-step analytical framework: mapping exposure, assessing vulnerability, analyzing system criticality, identifying resilience measures, and conducting economic analysis [40][41][49][55]. - The GRI and HARMA models are presented as effective tools for conducting resilience assessments, with GRI focusing on rapid screening and HARMA providing detailed economic evaluations [56][58]. Case Studies - The report includes case studies from the Kyrgyz Republic, Nigeria, Pakistan, Brazil, and Malawi, showcasing practical applications of resilience analysis tools and their impact on investment prioritization and infrastructure planning [64][66][68]. - In the Kyrgyz Republic, a GRI application identified high-risk corridors for intervention, while Nigeria's assessment estimated significant repair costs from flooding, highlighting the need for targeted resilience investments [65][82]. - Pakistan's HARMA application demonstrated the tool's capability to assess network criticality and prioritize investments based on climate risks, while Brazil's integration of resilience analysis into operational processes exemplified effective implementation [66][67].

PME, a Dutch pension fund overseeing about $70 billion, has severed ties with BlackRock based on an assessment that the world’s largest money manager no longer acts in its best interests on issues such as climate risk https://t.co/gSZdRQviCh ...

Zillow’s climate risk scores have disappeared from home listings, but the risks are very real and more climate stories on Green Daily https://t.co/NeuYBBTNto ...

Zillow has deleted climate risk scores from US home listings. That means less information for buyers — but research raises doubts about the accuracy of such predictions https://t.co/IvOhMtEXOb ...

Amundi says it’s expecting to see more inflows as a result of what it describes as ongoing adjustments in institutional mandates triggered by a growing desire to manage climate risk https://t.co/bRqim26xZo ...

Core Viewpoint - The New York City Comptroller has expressed significant concerns regarding BlackRock's approach to engaging with public companies, particularly in relation to climate risk and decarbonization strategies [1][4]. Group 1: Asset Managers' Performance - BlackRock is the largest asset manager for New York City's pension funds, managing $42.3 billion across three pension plans [2]. - The Comptroller reported that 46 out of 49 public market managers are aligned with the city's decarbonization expectations, while BlackRock, Fidelity, and PanAgora are not [2]. - Lander indicated that the three asset managers failed to adequately address climate risk, which is essential for the long-term value of the pension funds [2][3]. Group 2: Recommendations for Change - Lander recommended that the city's pension funds terminate their relationships with BlackRock, Fidelity, and PanAgora due to their failure to meet climate expectations [4][7]. - The Comptroller suggested issuing a search notice for new managers to handle BlackRock's U.S. public equity index mandates to better align with climate expectations [5]. - Fidelity's restrictive engagement approach and PanAgora's limited focus on emissions disclosures were cited as reasons for their recommended termination [8]. Group 3: BlackRock's Response - BlackRock responded to the Comptroller's recommendations by stating that the accusations of abdicating financial duty are politically motivated and undermine retirement security [6]. - The firm mentioned that it has begun allowing clients to opt into its Climate and Decarbonization Stewardship strategy, although it will not proactively engage with U.S. companies [5].

Meet the climate risk engineers who prepare companies before disaster hits in today's Green Daily newsletter https://t.co/6vDW018iC0 ...