It takes patience and guts to invest in the environment
Al Gore does not just make films about climate change. His fund-management firm, Generation Investment Management, has just raised $683m for a “climate solutions” fund. The hope is that environmental principles and shrewd investing can produce strong profits.
But could the combination of soapbox movies and warm air form a bubble instead? Certainly, the valuations that have been attached to some green shares have brought back memories of the dotcom era. As yet, though, the sector has not created the household names, the Netscapes and the eBays, that were seen as “must buys” for your average day trader.
Indeed, so far this year, environmental investors must be feeling green with nausea. The Impax ET50 index of leading environmental shares peaked at 286 at the end of 2007 and then plunged by nearly a quarter in January; even after a recovery, it is still down 10% on the year.
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