An ETF is a fund that tracks an index, such as the S&P 500 or MSCI EAFE, but can be traded like a stock. ETFs bundle together the assets of stocks or bonds that are members of an index, and trade at approximately the same price as the net asset value of their underlying assets over the course of the trading day. Investors can do just about anything with an ETF that they can do with a normal stock, such as short selling. ETFs have transparent portfolios and are priced at frequent intervals throughout the trading day. An ETF provides easy diversification, low expense ratios, and the tax efficiency of an index fund while maintaining the trading features of an ordinary stock.

An ETF tracks an index and trades at approximately the same price as the net asset value of the fund. An ETF is traded on a stock exchange and can be bought and sold at any time during the day, and it is open ended, which means that new units can be issued in response to demand.

ETFs, Unit Trust Funds and mutual funds are all open-ended funds, which means that there is no fixed amount of capital in the fund and they trade at a price which is close to the net asset value of the fund. A Unit Trust Fund differs from a mutual fund in that it is unmanaged, meaning they are not buying and selling shares, while mutual funds are actively managed by professional fund managers. As a result, Unit Trust Funds have lower annual operating expenses than mutual funds, which charges/incurs fees for the active management, but will often have sales charges and entrance/exit fees. ETFs have lower operating expenses than both since they track an index, thereby avoiding high management fees, and are more tax-efficient through “in-kind” creations and redemptions. Since an ETF is traded like a normal stock, it can be bought and sold at any time during the day, unlike most mutual funds, and offer transparency, while most mutual funds, or actively managed funds, only disclose their holdings a few times a year.

Some investors appear to believe that the liquidity of an ETF is dependent on the fund’s average trading volume, or the number of shares traded per day. However, this is not the case. Rather, a better measure of ETF liquidity is the liquidity of the underlying stocks in the index. The Osmosis Climate Solutions index is screened for liquidity. Stocks must have a minimum 10% free float and average daily trading volumes of no less than usd1 million.

The minimum size of purchase is 1 unit.

The Osmosis Climate Solutions index is rebalanced semi-annually.

Current investment instruments and indices that track climate change innovation tend to lack diversity and are narrowly represented. Their focuses are primarily on energy production and/or are largely exposed to big caps with only minority climate change contribution. The companies in the Osmosis Climate Solutions Index derive 50%+ of their revenues from products or services focused on the efficient use of natural resources and the mitigation of climate change.The sectors of the global companies in the index range from low carbon energy production, energy efficiency & energy management, to water, waste & pollution control, and includes capital deployment and financial products like carbon trading.