Monday, 11 March 2019

FP WHEB Sustainability - New Addition


I came across this investment fund whilst researching the spectrum of sustainable investments for the second part of 'Investing for a Green Future' last November.
This is a managed globally diverse equity fund. All holdings in the fund are exclusively attempting to offer solutions to creating a sustainable, low carbon environment.
 
It has been going since 2009 and is run by a small partnership who have an investment in the fund which I like to see as it aligns the management interest with that of investors. Here's an interesting post by one of the founding members, George Latham

The fund is focused on a number of themes which include clean energy, resource efficiency, sustainable transport and water management as well as a number of social aspects including education and health. It was a top-rated fund in Ethical Consumer's funds table (2018)

The fund is very transparent and publishes details on each and every company it invests in. It has also launched an impact calculator which allows investors to see how their investment in the fund is helping the environment.

Here's a link to the latest factsheet (pdf) for end February 2019.

Total return for the WHEB fund over the past 5 years is 60% or average 9.8% per year which compares well against the FTSE All Share index of 30% and 5.4% p.a.

The fund is held in my ISA and was purchased with the proceeds from the sale of my Smithson Investment Trust. Purchase price was 208p.


5 yr chart v FTSE All Share Index (blue line)
(click to enlarge)

Last week, the world's largest sovereign wealth fund which manages $1 trillion (£780bn) of Norway's assets, announced it would remove investments in holdings involved in oil/gas exploration. This will involve the sale of 134 companies including UK-listed Tullow Oil, Premier Oil, Soco International and Ophir Energy. “The objective is to reduce the vulnerability of our common wealth to a permanent oil price decline,” said Norway’s finance minister, Siv Jensen.

The share price of Premier Oil has fallen by 33% over the past 6 months - 4% on Friday following the announcement.

This represents a shot across the bows of the oil & gas sector and the large fund managers will be taking note and thinking of ways to climate-proof their portfolios which could accelerate very quickly as pressure mounts for action on global warming.

As many billions of dollars are released from the sale of such investments, the question to be asked is where will it be reinvested? My guess would be into sectors which are providing solutions to tackle the climate crisis - clean energy, sustainable transport and technology which supports a low carbon future.
  
This addition pushes my green allocation to over 20% which is far more than I was planning at the start of this year. Eagle-eyed readers may have noticed I have now included a 'green' tab to keep track of the various articles relating to this growing sector of my portfolio.

As ever, this article is merely a record of my personal investment decisions and should not be regarded as an endorsement or recommendation - always DYOR!

4 comments:

  1. Thanks for the interesting articles you’ve recently been posting on renewable energy, as one who’s always given the oil and gas industry a wide berth!
    I have been invested in the UK renewables sector with BSIF,TRIG,JLEN,NESF for the last 3 years or so. Some of these UK funds are now looking overseas to diversify their portfolios, good but possibly introducing additional risk than before.
    One to watch this week is an Australian company raising funds in London to launch a US solar fund which may be of interest too. I’m hoping there will be more of these opportunities to invest in going forward, and maybe an umbrella trust/fund that invests in renewable companies

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    1. Thanks, I will look out for the new fund launch, do you have a name for it?

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  2. Details are at ussolarfund.co.uk/offer

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    1. Thanks for the link. It looks interesting and also several layers - Oz company lists in London to raise finance for investment in US. Managed by NESM which is owned by another company which is a subsiduary of Evans Dixon.

      My main concern at present would be President Trump who doesn't seem so keen on renewable energy and supports coal/oil so I will keep it on my watchlist and see how it goes after the launch.

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