On April 23, 2025, Dutch asset management firm Robeco announced the launch of its new Robeco 3D Emerging Markets UCITS ETF, marking a significant expansion of its active 3D ETF family. This ETF aims to tap into the growth potential of emerging markets while leveraging Robeco's 15 years of experience in this asset class.
The Robeco 3D Emerging Markets UCITS ETF is designed to provide investors with a compelling alternative to traditional passive ETFs, offering liquid and transparent access to emerging market equities. This new fund will be listed on major European exchanges, including the London Stock Exchange, the SIX Swiss Exchange, Frankfurt Stock Exchange, and Borsa Italiana, with a total expense ratio (TER) of 0.30%.
Robeco has positioned the ETF to capitalize on the complexities of emerging markets through a sophisticated quantitative approach. According to the firm, the ETF employs a data-driven process that integrates short-term signals powered by artificial intelligence (AI) and machine learning. This allows for a nuanced analysis of short-term market dynamics, which is crucial in the fast-paced world of emerging markets.
Nick King, the Head of ETFs at Robeco, expressed enthusiasm about the launch, stating, “Our active 3D equity ETFs have been very well received by clients, and we have now extended the range to include emerging markets alongside our existing US, European, and global developed market exposures.” King emphasized that Robeco has a strong track record in managing quantitative emerging market strategies, refining their methodologies over the years.
The launch of the Robeco 3D Emerging Markets UCITS ETF reflects a growing momentum among European investors who are increasingly valuing active ETFs for their versatility, cost efficiency, and accessibility. Robeco’s Enhanced Indexing strategy, which underpins the ETF, is designed to be active and cost-efficient while also integrating sustainability considerations, building on the firm’s legacy as pioneers in emerging markets dating back to the 1990s.
Robeco's approach to the ETF is not just about capturing market returns; it also focuses on sustainability and risk management. The Enhanced Indexing strategy allows for small but impactful deviations from the index, utilizing environmental, social, and governance (ESG) signals to mitigate potential downside risks. This is particularly important in the volatile landscape of emerging markets.
Moreover, the ETF leverages advanced technologies such as machine learning and natural language processing (NLP) to enhance its responsiveness to market changes. These tools help the fund to better understand and react to short-term market dynamics, which is critical for maintaining a competitive edge in the fast-evolving investment landscape.
King noted that the ETF strategy will focus on the most liquid stocks within the emerging markets to ensure smooth execution while capturing the unique alpha that this capability offers. He remarked, “Over this time, we have established a very strong track record, refining our factor definitions and leveraging advancements in computing power, machine learning, and natural language processing.”
The introduction of the Robeco 3D Emerging Markets UCITS ETF brings the total number of strategies in Robeco’s 3D suite to five, each designed to actively balance risk, return, and sustainability considerations. This expansion signifies Robeco's commitment to providing innovative investment solutions that cater to the evolving needs of investors.
Looking ahead, King indicated that Robeco plans to diversify its offerings further, with aspirations to move beyond equities into fixed income in 2025. He stated, “We want to be a multi-asset platform, so fixed income is going to be the next area of focus moving into 2025.” King also emphasized that Robeco will not venture into passive management, as the firm aims to concentrate on areas where it can truly add value, specifically in the active investment space.
As the ETF market continues to evolve, Robeco’s latest offering is poised to attract investors seeking active management in the emerging markets sector. With its combination of advanced technology, a solid historical track record, and a commitment to sustainability, the Robeco 3D Emerging Markets UCITS ETF is set to become a noteworthy player in the competitive landscape of investment funds.
