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Pictet-Global Environmental Opportunities, reasons to invest

Pictet-Global Environmental Opportunities, reasons to invest

January 2018

We believe companies seeking to solve environmental challenges through innovation, technology and intelligent use of natural resources will experience above-average growth

The environmental investment opportunity

Protecting the environment is now a priority for consumers, companies and governments. Their converging interests, driven by increased global awareness, technological advances and health concerns, are underpinning a global drive to safeguard the world’s natural resources.

The private sector is rising to the challenge with the most proactive companies integrating environmental policies into their sales strategies and business models to generate new opportunities. We believe companies with products and services that maximise resource efficiency and help diminish pollution will offer long-term sustainable returns and superior growth rates.

Between 2000 and 2012, global annual applications for environmental patents more than doubled. – Reference: World Intellectual Property Organization
The Pictet-Global Environmental Opportunities fund seeks capital growth by investing in companies that are active along the environmental value chain. In particular, companies operating in services, infrastructures, technologies and resources related to environmental sustainability.

Reasons to invest in Pictet-Global Environmental Opportunities

  • Growth engine
    We believe companies with products and services that maximise resource efficiency and help diminish pollution have the ability to outperform the broader market over the long term. As such, the fund can be deployed as a growth engine in a global equity portfolio.
  • Diversification
    The fund aims to exhibit a lower correlation to traditional market-cap weighted equity indices with a similar volatility, meaning it can be used to diversify an investor’s existing global equity portfolio.
  • The pioneer in thematic investing
    With over 20 years of experience in thematic investing, we have developed a distinctive investment approach to identify long-term high growth winners in contrast to a benchmark driven management style. This proven investment process, applied across all Pictet thematic strategies, uses active management to build high conviction portfolios.

Why now?

With three billion more middle-class consumers expected by 20301, pressure on the world’s finite natural resources will intensify, leading to scarcity and quality challenges. The private sector, governments and consumers are becoming increasingly aware of the threat posed by resource scarcity and pollution. There is an opportunity for companies that recognise this trend and can offer innovative solutions.
As countries develop, their environmental impact grows
High Human Development Index linked to higher carbon footprint
Reference: United Nations Human Development Programme, Global Footprint Network, 2012

Who is it for?

The fund could be suitable for investors who are prepared to invest for the long term and to take a potentially higher risk with their investment. It may also appeal to investors who want to gain exposure to companies working to solve environmental challenges.

What are the risks?

  • Past performance is not a guide to future performance. The value and income of an investment can fall as well as rise and you may not get back the amount originally invested.
  • The fund may be invested in emerging markets. Investments in emerging markets can potentially be of higher risk and volatility than those in developed markets.
  • Investments are made in assets that are denominated in foreign currency and are not hedged back to the base currency of the fund. Changes in exchange rates may therefore affect the value of the investments.