Plato Investment Management has introduced the global net zero hedge fund, which it said would aim to outperform the MSCI World Index, while maintaining a net zero carbon exposure using the calculation methodology recommended by the Task Force on Climate-related Financial Disclosures.
Open to retail and wholesale investors, the fund is an active extension long/short strategy that targets high carbon emitting listed companies via short positions, while taking long positions in companies with better than average carbon footprints.
Since its inception on 1 September 2021, the Plato global net zero strategy has delivered returns of 8.29 per cent, compared to 4.38 per cent for the MSCI World benchmark.
Plato Investment Management managing director Dr Don Hamson said the fund has been launched to offer a “net zero now” option for investment portfolios.
“We believe the race to net zero emissions will be the most important investment thematic over the next 30 years, and we think this unique strategy provides a way for investors to achieve net zero now, while gaining exposure to the greatest economic transition we’ll likely see in our lifetimes,” Dr Hamson said.
“Climate change is an issue that our team and many of our clients feel strongly about and through the Plato Global Net Zero Fund, we will be able to actively play a bigger part in driving corporate change while having the ability to starve polluters of capital by shorting the most egregious emitters.”
Hedge fund co-portfolio manager and head of long/short strategies, Dr David Allen said the strategy would benefit from Plato’s quantitative systems, along with the integration of hundreds of new environmental, social and governance (ESG) data points.
“We know an average-sized SMSF invested in the ASX 200 requires 3,135 trees to get to net zero, so I think this new fund is a game-changer for those who want a simple solution to help them generate alpha while maintaining a net zero carbon footprint,” Dr Allen said.
“Importantly the strategy is underpinned by Plato’s proprietary quantitative systems which have been delivering strong outcomes for more than 15 years for investors ranging from self-funded retirees to superannuation funds.”
Plato’s red flags model incorporates over 100 ESG red flags, including around 60 environmental inputs.
Plato Investment Management is a member of Climate Action 100+ initiative and a signatory of the UNPRI as well as the Montreal Carbon Pledge.
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