Online broker eToro has launched XtremeWeather, a new portfolio providing retail investors with exposure to companies best-positioned to prosper due to increasingly frequent and severe extreme weather events.

The XtremeWeather portfolio comprises 30 stocks from key industries such as renewable electricity, industrial machinery, supplies and components, fertilizers and agricultural chemicals, retail home improvement, electrical components and equipment, and gas, that are at the forefront of supporting recovery and normalisation following extreme weather events.

To construct this portfolio, the team evaluated thousands of stocks, ranking them based on criteria including market capitalization, ESG score, liquidity parameters, analyst rankings, and trailing 12-month sales growth.

Dani Brinker, Head of Investment Portfolios at eToro, commented:

“2023 will be remembered as the year of climate change. From the effects of El Niño in Australia to the floods in Italy and the wildfires in Maui, almost no continent has been immune.

With the global climate conference, COP28, around the corner, we wanted to offer retail investors the opportunity to invest in the climate-proof their portfolios and diversify into industries that will help rebuild our cities, communities, and surrounding wildlife after these extreme climate events.”

The portfolio will be rebalanced annually or on demand to maintain its relevance and optimise performance. To address the unpredictability of weather events and the influence of any new economic and governmental policies, the allocation strategy distributes equal weight across all 30 stocks (3.33%). This approach is designed to reduce concentration risk and enhance the portfolio’s overall resilience.

Initial investment starts from USD$500 and investors can access tools and charts to track the portfolio’s performance, while eToro’s social feed will keep them up-to-date on developments in the sector. For now, this portfolio is not available to US users.