Decarbonisation, a growing thematic
What sectors and companies should I invest to play the ‘decarbonisation trade’.
Are prices already too high?
Thanks
Lindsay
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Answer
Hi Lindsay,
The decarbonisation trade has become very in vogue and its led to the establishment of numerous ethical funds as major investors move away from fossil fuels e.g. the world’s largest fund manager Blackrock has committed to no longer actively invest in companies generating more than 25 per cent of revenue from thermal coal. Obviously the lithium space which is a major resource used in batteries has been going gangbusters of late with Orocobre (ORE) reaching our target this week, hence we took profit on our position in our Emerging Companies Portfolio.
At this stage while MM likes the play we feel the risk / reward dictates caution and a watch & see approach i.e. too many people may be long names exposed to the thematic at this stage of the cycle.
