Doug Goodwille from Kayne Anderson speaks to Drew Meredith from The Inside Network on market thinkers.
While a surging gold price is on hold as the world adjusts to a Trump presidency, all the factors that saw its price rise more than 50 per during his first term in office – trade disputes, fiscal deficits and geopolitical tensions – are almost certainly guaranteed the second time around.
‘Cost-benefit’ the driver of leading climate change-focused equity fund
Nick Griffin’s Munro Partners has launched a climate fund providing investors exposure to carbon solutions.
Griffin says “We’ve reached this point where now its simply a cost-benefit analysis. And while the heating of the planet will slow over time, it’s clearly not on the trajectory that we need it to be. So what people and governments around the world have decided is whether to deal with the extra cost of not dealing with this, which is in the trillions of dollars caused by natural disasters. Or, do they want to spend the money to reduce the temperature on the planet by 1.5 degrees. That is the argument that is being held today.”
Investors have become green-conscious and are looking for more than just an ESG fund. The Munro Climate Change Leaders Fund (Managed Fund) aims to meet this need while outperforming its benchmark index over five to seven years, while providing higher relative exposure to carbon solutions.
“Munro believes climate change – and the elimination of carbon – presents the biggest investment opportunity since the internet,” says Nick Griffin.
Munro Partners says “the fund will invest in a concentrated portfolio of 15 to 25 listed equities across a range of industries and countries whose earnings prospects should improve with the increased investment in, and focus on, decarbonisation.”
One thing Griffin has had a knack of doing well is being to identify sustainable growth trends that are underappreciated and mispriced by the market, and the resulting winning stocks. Using Griffin’s S-Curve theory, climate investment is at the very start of its S-curve, at the start of structural change. There are a stack of new climate technologies that are still in the early adoption phase with significant growth potential.
Munro’s goal is to create a portfolio of climate winners that help decarbonisation of the planet and reverse climate change. The team has identified four areas of interest that will help reach the decarbonisation goal:
- Clean Energy – Renewable energy generation companies – wind, solar and renewable diesel.
- Clean Transport – Electric vehicles, battery technology, and alternative transportation.
- Energy Efficiency – Insulation products, electrical switches, lighting and metering technology.
- Circular Economy – Improve recycling, alternative packaging materials and management of wastewater.
The Munro Climate Change Leaders Fund will be quoted on the ASX under ticker code MCCL as an Exchange Traded Managed Fund.
