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The main facts about Climate Change Investment
- This is a serious investment sector with main stream players such as Merrill Lynch, Schroders, Allianz and Deutsche Asset Management involved.
- Globally, in the region of £35 billion is invested within mutual funds.
- Climate Change Investment funds are not just investing in small technology companies. These funds operate in the global growth sector and invest in large multi-nationals. For example Schroders Global Climate Change fund at 31st March 2008 was invested 57% in Large Cap stocks, 24% in Mid Cap and only 19% in Small Cap.
- The most prominent stock within this field is Vestas Wind Systems, which is a global manufacturer of wind turbines. It has a market capitalisation of £20 billion and Allianz estimate that it is trading on a forward PE of 21. It is a Danish stock, but had it been listed in the UK it would have ranked 33rd in the FTSE 100, one place above BSKYB, on the 31st March 2008.
- Funds in this sector have outperformed their benchmarks, largely due to their exposure to alternative energy. In the 6 months to the 14th April 2008 Pictet's Clean Energy fund was up 10.79%, compared to the FT World Index which was down -5.03%.
- Given the global outlook Climate Change Investment looks set to continue to provide out performance.
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