According to the press release, it is the first-of-its-kind, fund of fund investing in an underlying fund which has a thematic focus on climate change. The scheme will invest predominantly in the units of the HSBC Global Investment Funds – Global Equity Climate Change. The scheme may also invest a certain proportion of its corpus in money market instruments and / or units of overnight / liquid mutual fund schemes, in order to meet liquidity requirements from time to time.
The underlying fund has identified nine sub-themes to address the challenges ranging from renewable energy and energy efficiency to clean transportation and natural capital. The potential investments are selected for alignment with the theme, including their carbon footprint and ESG score are checked. In addition, the holdings are diversified geographically with investments in both developed and emerging markets and all nine sub-themes.
The underlying fund undertakes detailed ESG assessment and once it is satisfied that the company has an enduring business model and a sustainable growth path the company’s stock is available for inclusion in the portfolio, the fund house says.
“At the last World Economic Forum meeting at Davos, Climate Change was identified by global business leaders as the number one risk factor for their businesses. To mitigate this risk will require significant resources. We see this investment cycle playing out over a long period of time as countries and business try to achieve a net zero position by 2050. We as HSBC are committed to this cause and as HSBC Asset Management have designed this fund for both retail investors and institutions to support and invest in this cause without compromising on financial returns,” Ravi Menon, CEO, HSBC Asset Management, India.
He added that, “Climate change is creating new market and investment opportunities across all industries and market capitalisation. Investors are increasingly focused on environmental matters and this fund is designed to help them achieve a financial return, whilst creating a positive impact on the global environment. HSBC Global Equity Climate Change Fund of Fund is perhaps the first-of-its-kind investment offering in the country and demonstrates our commitment to address global issues whilst offering our investors an opportunity to gain from the same.”
Talking about the underlying fund Angus Parker, Head of Developed Markets Equity Team, HSBC Asset Management, London, said, “HSBC Global Investment Funds – Global Equity Climate Change has a thematic focus on climate change. It invests in companies that may benefit from the transition to a low carbon economy by having a higher environmental, social, and governance rating compared to the broader global equity market. With investments in global equities, the fund offers the necessary risk diversification over the long term and can support the delivery of sustainable risk-adjusted returns.”
