Traded under the IDX ticker XPSG, the new fund places an emphasis on the ESG principles while adopting a smart beta strategy that uniquely combines a passive-active style investment model.

Pinnacle Investment would invest in highly liquid Indonesian large-cap companies that had a strong commitment to ESG principles, Pinnacle Investment president director Guntur Putra said at the launch.

“We will invest in companies that have concerns for the environment, and minimize exposure to companies that are fundamentally misaligned with sustainable services,” Guntur said.

“We will not invest in cigarette, tobacco or mining companies, which do not demonstrate sufficient community social responsibility,” he said.

Pinnacle Investment would accommodate investors who wanted to invest and simultaneously make sustainable and positive impacts, yet maintain a similar level of risk and liquidity as the equity market, he said.

“Although globally there has been awareness of ESG-based exchange-traded funds, they are considered new here,“ he added.

This was Pinnacle Investment’s fifth ETF, and the 15th listed on the Indonesian bourse, IDX director Nicky Hogan said.

“Pinnacle’s ETF will enrich product choices for investors,” Nicky said.

The four previous Pinnacle Investment ETFs include XPLQ (Pinnacle Enhanced Liquid ETF), XPDV (Pinnacle
High Dividend ETF), XPLC (Pinnacle Large-Cap ETF) and XPES (Pinnacle Enhanced Sharia ETF).

“We don’t set a specific target when we launch a new ETF. We are more focused on creating innovative products for investors,” Guntur said.

The total value of Pinnacle Investment’s assets under management (AUM) has grown to almost Rp 3 trillion since the company’s inception in June 2015. In October 2015, it introduced its flagship equity-based mutual fund, Pinnacle Strategic Equity, which focused on liquid large-cap stocks, with returns of 30.16 percent in 2016 and 21.36 percent in 2017.

Since mid-2016, the company began to focus on its ETF, with its values now growing to nearly
Rp 500 billion (US$ 37.2 million). Last year, XPLQ was one of the best performing ETFs on the Indonesian
market, posting a 26.16 percent return.

Pinnacle Investment plans to launch three or four more ETFs this year with different concepts to give investors more options. (roi)

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