Solactive is delighted to announce that leading Australian fund manager, BetaShares, has expanded its engagement with the German index provider by choosing the Solactive Global Royalties Index for its new BetaShares Global Royalty ETF – the world’s first exchange traded fund of its kind. The product aims to track the performance of a portfolio of global companies that earn substantial revenue through royalty income, royalty-related income, and intellectual property income.
The Solactive Global Royalties Index is a representation of firms earning royalties by licensing their intellectual property or tangible assets, or earning revenues through royalty finance or royalty streaming.
Under the Index Methodology, a committee determines the list of index components by categorizing companies based on their revenue generation through royalty income and intellectual property income, including from subscriptions, streaming, downloading, licensing, digital, physical products, or similar income. Selected companies include businesses from the mining sector that sell royalty interests in future production or revenues in return for an up-front or ongoing cash payment, or companies that own IP and Tangible Royalties – businesses that license IP rights (in industries including music, biotech, and IT) or physical assets in return for royalty payments.
BetaShares Global Royalty ETF (ROYL) started trading on the ASX.
Timo Pfeiffer, Chief Markets Officer at Solactive, says: “Royalty companies have in general attractive fundamental characteristics such as stable and recurring cashflows, and can benefit from inflationary scenarios as they have limited exposure to COGS. We are delighted to partner once more with BetaShares, one of the leading players in the Australian ETF market, to provide investors with such a cutting-edge product, which reinforces our shared innovative mindset and customer-oriented approach.”
Alex Vynokur, BetaShares CEO, comments “We believe Royalty companies are one of the best kept secrets in finance. For many investors, royalty companies have tended to fly under the radar despite their long history of value creation. We are proud to harness this innovation for investors by offering dedicated exposure to a portfolio of royalty companies across a range of sectors via our recently released Global Royalties ETF. The innovative nature of ROYL offers investors exposure to the royalty income associated with cutting edge pharmaceutical drugs, carbon credits, the music of hit artists like Sting, Bob Dylan and David Bowie as well as the extraction of gold, precious metals and iron ore.”
