Climate risk – what are the opportunities for investors?
By Svetlana Borovkova, Head of Quantitative Modeling
Climate risk is firmly on the agenda of financial institutions. However, it is not all doom and gloom. While climate change poses significant risks to investors, it also opens up lucrative investment opportunities, as certain types of companies can benefit from climate change and climate risk regulations.
A current trend in asset management is thematic investing, which can be defined as identifying a global macroeconomic trend (e.g. climate change) and selecting companies positively exposed to this trend (i.e. those that stand to benefit from it). .
While some types of companies are obvious winners (such as renewable energy companies or electric vehicle manufacturers), other investment opportunities are less apparent, but just as interesting from the perspective of climate risk.