The Evelyn Partners Sustainable Managed Portfolio Service (MPS) team has initiated positions* in the Trium Climate Impact and Regan Sustainable Water and Waste funds in its latest re-balance.
While the Sustainable MPS team believes that equities are broadly attractive, they have primarily continued to allocate to US and core-style global equity funds.
In the latest re-balance they added to positions* in the FTGF ClearBridge US Equity Sustainability Leaders and Brown US Sustainable Growth funds. In global equities, they added to holdings* in the Impax Environmental Markets, Schroder Global Sustainable Value, CT Responsible Global Equity, Baillie Gifford Responsible Global Equity Income and Federated Hermes Global Equity funds.
Within fixed income the managers continue to favour sovereign bonds over corporate credit.
Commenting on the two new holdings, Philippa Douglas, assistant manager of the Evelyn Partners Sustainable MPS says:
“Across all models we switched from the JPM Global Macro Sustainable fund into Trium Climate Impact fund in the Absolute Return allocation. The shift is part of an exercise to reduce equity correlation in the Absolute Return allocation. Trium Climate Impact is a market neutral hedge fund which invests in mid and large cap climate solutions in its long book and hedges out volatility, factor and style risk in its short book. The team seek significantly higher avoided emissions than direct emissions in potential investee companies, as well as contributions to clean water, less waste, the circular economy and improved efficiencies. The fund targets a return of cash plus 6-8% and volatility of 6-8% with low correlation to traditional asset classes and driving positive environmental outcomes.
“Within the moderate to higher risk models we switched out of the RobecoSAM Smart Materials into the Regnan Sustainable Water and Waste fund. This reflects our preference for the more defensive nature of the water and waste theme, which is integral to daily life throughout the economic cycle, as well as the structural growth drivers for these sectors as global population increases and urbanises. Additionally, the team’s focus on quality characteristics of businesses and the sustainability of their investee companies’ operations reflects our own investment philosophy well.”
*please see the re-balance note for full details on the changes made to individual portfolios.
