Not all Commodity ETFs are Created Equal

Gain exposure to the carbon credit market through TD Global Carbon Credit Index ETF (TCBN). Managed by TD Asset Management Inc. (TDAM), one of the largest and most experienced investment managers in Canada. For more information on TD ETFs and ETFs in general visit our TD ETF Resource Centre.

What is a carbon credit?

TCBN seeks to track the performance of a global carbon credit index which measures the investment return of global cap-and-trade carbon credits. A carbon credit is a tradeable permit or certificate issued through a regulatory organization allowing the holder to emit a certain amount of CO2 or other greenhouse gases (GHGs). Carbon credits have emerged as an important alternative asset class as countries around the world have sought a meaningful way to reduce carbon emissions in an effective, market-friendly fashion.

Why invest in carbon credits?

  • A unique and growing sector

    With the proliferation of carbon pricing programs and as markets transition from traditional carbon-emitting fossil fuels to more sustainable energy sources, the carbon credit market is expected to continue to grow well into the future1.

  • Low correlation to traditional asset classes

    Gain exposure to an asset class that historically has low correlation to equity and fixed income markets. Choosing assets with low correlation with each other may help to reduce the risk of a portfolio.

  • Participate financially in the energy transition economy

    TCBN offers the opportunity to financially participate in the energy transition from carbon-emitting fossil fuels to more sustainable energy sources through exposure to the carbon credit market.

Key Features of TCBN

Exposure to largest and most liquid carbon credit markets
Access the global carbon credit markets, primarily the European Union’s (EU) Emissions Trading System, the largest and most liquid carbon market in the world and a cornerstone of the EU's policy to combat climate change.

A strategic investment approach
TDAM will conduct a semi-annual review of global carbon emission markets to determine suitability and may expand its exposure to carbon credits that trade on other global Emissions Trading Systems as those markets mature, offering further opportunities for growth.

Opportunity for enhanced portfolio returns
The supply and demand of carbon credits establishes the market price. The supply of carbon credits is set to decrease as jurisdictions commit to the goal of lowering carbon emissions to meet strict pollution standards. In addition, demand for carbon credits is estimated to increase in the future – offering significant growth potential. TCBN also leverages the decades of investment experience of one of the largest asset managers in Canada.

Low-cost
One of the lowest management fees in North America for its asset class.

Key Facts

Below are the current target holdings of the TCBN ETF, subject to change. The portfolio manager in conjunction with the index provider intends to provide investors exposure to the most liquid carbon credit markets in the world. As new markets develop and become more liquid, they may be added to the index, and in turn the ETF.

Holdings (Notional Exposure)

*The ETF may use derivatives such as futures contracts, and/or total return swaps to gain needed exposures.

TD Global Carbon Credit Index ETF

TSX Ticker

TCBN

Benchmark

Solactive Global Carbon Credit TR CAD Hedged Index

Management Fee (%)

0.65

Risk Rating

High

Distribution Frequency

Annually, if any

TCBN Additional Resources

Thought Leadership Papers

Fund Card

Product Overview

Q&A

Ways to invest with us

Below are some options to invest in TD ETFs within TD. If you are not a client of TD or already work with an investment professional, feel free to ask them about our ETF lineup.

1Source: Refinitiv 2022, “Carbon Markets Year in Review 2021”.

The information contained herein has been provided by TD Asset Management Inc. and is for information purposes only. The information has been drawn from sources believed to be reliable. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual's objectives and risk tolerance. Commissions, management fees and expenses all may be associated with investments in ETFs. Please read the prospectus and ETF Facts before investing. ETFs are not guaranteed, their values change frequently and past performance may not be repeated. ETF units are bought and sold at market price on a stock exchange and brokerage commissions will reduce returns. TD ETFs are managed by TD Asset Management Inc., a wholly-owned subsidiary of The Toronto-Dominion Bank. The TD Global Carbon Credit Index ETF ("TD ETF") is not sponsored, promoted, sold or supported in any other manner by Solactive AG nor does Solactive AG offer any express or implicit guarantee or assurance either with regard to the results of using the Solactive Global Carbon Credit Index (CA NTR) ("Index") and/or any trademark(s) associated with the Index or the price of the Index at any time or in any other respect. The Index is calculated and published by Solactive AG. Solactive AG uses its best efforts to ensure that the Index is calculated correctly. Irrespective of its obligations towards TDAM, Solactive AG has no obligation to point out errors in the Index to third parties including but not limited to investors and/or financial intermediaries of the TD ETF. Neither publication of the Index by Solactive AG nor the licensing of the Index or any trademark(s) associated with the Index for the purpose of use in connection with the TD ETF constitutes a recommendation by Solactive AG to invest capital in said TD ETF nor does it in any way represent an assurance or opinion of Solactive AG with regard to any investment in this TD ETF. Certain statements in this document may contain forward-looking statements (“FLS”) that are predictive in nature and may include words such as “expects”, “anticipates”, “intends”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. FLS are based on current expectations and projections about future general economic, political and relevant market factors, such as interest and foreign exchange rates, equity and capital markets, the general business environment, assuming no changes to tax or other laws or government regulation or catastrophic events. Expectations and projections about future events are inherently subject to risks and uncertainties, which may be unforeseeable and may be incorrect in the future. FLS are not guarantees of future performance. Actual events could differ materially from those expressed or implied in any FLS. A number of important factors including those factors set out above can contribute to these digressions. You should avoid placing any reliance on FLS. All trademarks are the property of their respective owners. TD Asset Management Inc. is a wholly-owned subsidiary of The Toronto-Dominion Bank. ® The TD logo and other TD trademarks are the property of The Toronto-Dominion Bank or its subsidiaries.