Investors looking to tap into returns through the environmental sector now have access to four thematic plays in one fund - the Pictet-Environmental Megatrend Selection.
Launched by Pictet Funds, the distribution company of the Swiss private bank Pictet & Cie, the fund will give invest in the following of Pictet’s global sector and theme funds: Water, Clean Energy, Timber, and Agriculture.
Pictet said these areas as subject to persistent, secular change capable of generating rich investment themes. The firm believes that changing demographics as well as growing scarcity of water, arable land and timber combined with a shift of energy production to environmental friendly resources offer a remarkable potential for long-term growth.
Laurent Ramsey, CEO of Pictet Funds, said: “This fund is supported by solid long term fundamentals with excellent growth perspectives. We've focused our expertise in this field to provide investors a diversified, structured and socially responsible exposure to environmental megatrends."
The Pictet-Environmental Megatrend Selection fund, which is a Ucits III compliant euro-denominated product, applies widely accepted environmental, social and corporate governance criteria. Furthermore, Pictet will be engaging in active dialogue with companies as a shareholder to push for improvements. The firm will be using the expertise of Ethos, a Swiss Foundation for sustainable development, to help do this.
Dominique Biedermann, managing director of the Ethos Foundation, said: "From an environmental, societal and governance point of view, it makes sense to engage a company in dialogue. But it also gives economic and financial added value. For example, a company active in an environmentally controversial field may ultimately run into serious problems due to long term, unforeseen risks. This can have important financial consequences.”
The underlying investment universe of the new fund covers about 1,000 publicly-quoted companies with a small-to-mid capitalisation bias, combining solid firms from developed markets with fast-growing companies in emerging markets. While the underlying funds are individually managed, the new fund will employ a strategic allocation process with monthly rebalancing.
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