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Climate change Investing -

newgirl
in Fund Discussions
I am interested in this space - Would love to get some input - specifically - the advantage or dis-advantage ( beside the cost ) of 1.5 Degrees- a long/short fund or alternatives in this space.

https://info.bernstein.com/l/546252/2021-11-18/ykz3z

https://www.bloomberg.com/news/articles/2021-12-30/hurricane-force-gusts-fan-colorado-wildfires-force-evacuations

1.5 Degrees aims to make high single digit returns by focusing on climate change opportunities and companies benefitting or losing out from events such as rising sea levels, shifting consumer preferences and increased greenhouse gas emissions, according to the document, which didn’t mention how much the strategy was seeking to raise.
The fund joins a stampede among managers to integrate sustainability goals in their strategies as demand for such products booms. So-called environmental, social and governance investing has turned into a $35 trillion industry, providing a fertile ground for them to raise assets.

Comments

  • BenWPBenWP
    @newgirl: interesting topic. When you mention that there’s a “stampede” to invest or to gather assets then my antennae go up and I wonder if some unsuspecting investors might get swept along. It seemed at one point that solar panels could not fail to provide great returns, and then they did not. Of course, the fund you linked claims it will short some issues. The question I have is have the new managers ever succeeded at such a venture before. Maybe the Q&A they have scheduled will reveal something. For my part, I’m letting Brown Advisory pick sustainable companies for me.
  • LewisBraham
    edited December 2021
    Climate change is real and extraordinarily dangerous to the future of humanity and the planet itself. Yet this long-short vehicle you mentioned does not sound like a good fund. Part of the reason is the difference in time horizons between Wall Street and a phenomenon like climate change. Wall Street investors are short-sighted and only think at best generally about the next quarter while climate change is a slow moving train wreck that has taken decades to unfold. The private sector is ill-equipped to fight climate change because of its own short-sightedness. A company that might offer a technological solution years down the road with R&D will not receive the patience it needs from Wall Street to deliver that solution. Meanwhile, a company that is actively hurting the planet and could ultimately facilitate its destruction could have a good quarter and thus have strong performance. Neither the long side nor the short side may work here. The better option for investors is to starve the worst offenders of capital while trying to change the less worse offenders via shareholder activism. The best option for citizens is to encourage greater regulation of the private sector to fight climate change and global cooperation in hitting emmission goals. Regarding funds fighting the good fight in climate change, Green Century Balanced (GCBLX) holds no fossil fuels companies and is very active filing resolutions to change companies. It is conservatively managed.
  • newgirl
    @BenWP- RE: "stampede to invest" - that is a direct quote from the Bloomberg article, not me . 1.5 Degrees is an Alliance Bernstein Private Placement fund.I am looking for similar vehicles.
    @LewisBraham. The article quoted 35 trillion moving into this space - though it reads like that might include all "ESG". Who are the leaders ?
  • BenWPBenWP
    I did understand where the language came from, @newgirl. My point was that we should all be wary of investing fads. I agree that lots of companies are rushing to get ESG labels affixed to their funds, but I believe there is no standard by which to measure whether or not companies belong in such funds. I do not know of any fund resembling the AB venture you brought up.
  • Observant1
    "Regulators are cracking down on many aspects of ESG investing with basic rules to make it easier to punish greenwashing, where the environmental credentials of an investment or activity are overstated, in a cross-border sector where investment is 'exploding'".

    Link
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