Practical analysis for investment professionals

climate change


Beyond Carbon: Water Risks and Sustainable Investing

The water crisis in Cape Town, South Africa, demonstrates that carbon emissions and climate change are not the only sustainability threats, says Monika Freyman, CFA. Water concerns already affect investors' bottom lines as well as future risks to their top lines.

Rising Sea Levels and a Falling Margin of Safety

The environment's margin of safety is narrowing with each uptick in global temperatures. This will translate into greater effects on investor portfolios. It is the job of the investment manager to cushion against those risks while still seeking profitable opportunities.

Weekend Reads for Investors: Autumnal Edition

Jason Voss, CFA shares his Weekend Reads for Investors, including material on the prevalence of false memories, recent bank scandals, and new technologies that promise to transform the energy sector.

Book Review: Environmental Finance and Investments

The authors analyze environmental commodity markets and how they can attract investments, focusing on the application of market-based instruments to incentivize the behavior and change needed to deliver environmental quality and mitigate environmental risk. This book can be read linearly, chapter by chapter, or it can be used by fund managers, regulatory investors, and green-finance experts as a reference to gain valuable insights into how to manage carbon markets.

Integrating ESG into Fixed-Income Portfolios

Christoph M. Klein, CFA, explains how including ESG factors in fixed-income analysis can reduce idiosyncratic and portfolio risk and improve portfolio performance.

Investment Opportunities Flow from Water Initiatives

Environmental changes, population growth, contamination, and aging infrastructure are all contributing to water shortages. Solving such problems will require input from the for-profit and not-for-profit sectors. By targeting water initiatives, investors may find secular growth in municipal bonds, public and private company shareholdings, and exchange-traded funds.

Climate Change and Financial Stability: Which Risk Is Most Critical?

No word resonates more with investment professionals than "risk," and climate change is becoming the risk of the 21st century. As the threats posed to financial markets by climate change are understood with greater clarity, some investors seem to be taking note.

Climate Change and Investment Decisions: Selected Reading

How can institutional investors integrate climate change into their investment decisions? It's a challenging question certainly, and some would expect it to remain unanswered — or be relegated to obscure academic papers. On the contrary, it is a question that is being addressed head on by investment practitioners. Here is a list of five publications from 2015 that directly take on the challenge of climate change and investing.

Weekend Reads for Global Investors: Alibaba, Apple Pay, and Asset Allocation

Alibaba and Apple were in fierce competition this past week . . . for the headlines. The two tech giants picked the same day for their long-awaited events.

Has the Climate for Climate Bonds Changed?

A recent report co-authored by HSBC and the Climate Bonds Initiative, entitled “Bonds and Climate Change: The State of the Market in 2013,” is a strong indication that climate bonds are coming into their own.



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