New Index Fund Focuses on Renewable Energy

A number of indexed investment options have sprung up in the past few years offering investors a broad choice of companies involved in renewable energy and solutions to climate change. This week, KLD Research & Analytics, Inc. an independent investment research and index provider announced the launch of the KLD Global Climate 100 Index.

The KLD Global Climate 100 joins the ranks of the similar Wilderhill Clean Energy Index and the New Energy Finance Global Energy Innovation Index (GEIX. These indexes, designed to match typical stock market returns, don’t carry some of the “all-eggs-in-one-basket risk” and some of the limitations of making specific company investments. The Global Climate 100 Index is made up of companies that KLD expects will provide near-term solutions to global warming while offsetting the longer-term impacts of climate change through renewable energy, alternative fuels, clean technology and efficiency. KLD’s Global Climate 100 Index is designed for investors seeking specialized strategies to invest in these types of companies. “The Global Climate 100 includes companies making meaningful contributions to the commercialization of renewable energies such as solar and wind, future fuels such as natural gas and hydrogen, and innovations or applications of new technologies that help to reduce emissions of greenhouse gases,” said Peter D. Kinder, founder and president of KLD Research & Analytics, Inc. “The Global Climate 100 are companies working on solutions to climate change. These companies alone won’t ‘fix’ global warming, but the Index focuses investors’ attention on where the possibilities lie.” For a full list of the companies included in the KLD Global Climate 100, see the link following the story. According to Thomas Kuh, Managing Director of KLD Indexes, industry momentum indicates strong demand for the Global Climate 100 Index. This year, the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTERS) created their Green Wave Initiative, committing $1.5 billion to investments in innovative and responsible environmental companies. The Investor Network on Climate Risk, a group of pension funds and other institutional investors, launched a program to raise awareness about the financial risks posed by climate change. “Pension funds are concerned about the financial risks associated with climate change,” said Kuh. “As fiduciaries with a long time horizon, they are looking for new strategies to integrate these factors into their investments. The Global Climate 100 looks ahead to show investors where the opportunities to address global warming will come from.” KLD developed the Global Climate 100 Index in partnership with the Global Energy Network Institute (GENI), a non-profit research and education organization (www.geni.org). GENI will receive a portion of Index licensing fees, which will be dedicated to furthering its mission of promoting the development of electric power networks between nations and continents, with an emphasis on tapping abundant renewable energy resources. “Renewable and efficient technologies are presently growing their market share, and the KLD Global Climate 100 Index will be the benchmark for investors who seek both returns and global sustainability,” Kinder said.
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