*The Guinness Sustainable Energy Fund is currently being renamed. The Central Bank of Ireland will shortly authorise the name change from Guinness Alternative Energy Fund to Guinness Sustainable Energy Fund

The Guinness Sustainable Energy Fund gives investors exposure to global sustainable energy markets.

The Fund is managed for capital growth and invests in companies involved in the generation, storage, efficiency and consumption of sustainable energy sources (such as solar, wind, hydro, geothermal, biofuels and biomass). We believe that over the next twenty years the sustainable energy sector will benefit from the combined effects of:
  • Demand growth - renewable energy becoming competitive with power from fossil fuels
  • Improving Economics - alternative energy equities are undervalued due to poor energy sector sentiment, whilst fundamentals of renewables remain strong due to low cost of installation
  • Public & Private Support – corporate, consumer and government interest due to economics underpins long-term prospects
  • Low current exposure - alternative energy offers solutions to climate change, pollution, and energy security
  • Sustainability ThemeThe sustainable energy sector offers ‘green’ credentials that some investors are targeting to help facilitate global de-carbonisation and to reduce carbon intensity of their portfolios
Overview
Single sector Companies engaged in the generation and storage of sustainable energy and the electrification and efficiency of energy demand
High conviction Equally weighted, concentrated portfolio (30 positions) of public equities with a minimum $500mn market capitalisation
Fully invested No cash management, FX hedging or derivatives
Unconstrained No reference to the benchmark, the MSCI World Index *
Global Diversified globally
Investment type Listed equities (long-only) with low turnover
Fund structure Dublin OEIC (UCITS IV); daily dealing; no performance fees
Launch date 19 December 2007

In brief: why invest in sustainable energy?

Demand growth
The electrification of transportation and improved energy storage economics brings attractive long term sustainable energy demand growth
Improving Economics
Both governments and companies are pursuing sustainable energy in order to achieve mandated carbon targets or to improve public perception
Public & Private Support
Both governments and companies are pursuing sustainable energy in order to achieve mandated carbon targets or to improve public perception
Low current exposure
Poor profitability and need for subsidies has kept the weight of sustainable energy in global indices and broad global equity funds at a low level
Sustainability Theme
The sustainable energy sector offers ‘green’ credentials that some investors are targeting to help facilitate global de-carbonisation and to reduce carbon intensity of their portfolios

Why invest in the Guinness Sustainable Energy Fund?

  1. Concentrated Exposure

    The Guinness Sustainable Energy fund aims to deliver investment returns via equal weighted, concentrated exposure to 30 sustainable energy companies; available in a daily traded UCITS structure

  2. Specialist Team

    The Guinness Energy Team has 20 years of experience of running energy investment strategies in a consistent manner and providing insight for investors into the energy markets

  3. Investment Process

    The Fund is run using a Top Down and Bottom Up investment process based on an internally created Universe of 179 Sustainable Energy companies with detailed valuation models

  4. Valuation Opportunity

    The fund selects the most attractive equities in the Universe and it displays growth together with higher return on capital, lower valuation multiple and stronger balance sheets than the MSCI World Index

  5. Sustainability Theme

    The Guinness Sustainable Energy Fund offers ‘green’ credentials that some investors might use to help facilitate global de-carbonisation and to reduce carbon intensity of their own investment portfolios

Fund Manager

Edward Guinness

Edward joined Guinness Asset Management in January 2006. He is manager of the Guinness Sustainable Energy Fund and a fund manager in the Guinness EIS Team.

Prior to joining Guinness Asset Management, Edward worked from 2002 as a merger arbitrage analyst for the Arbitrage Associates Fund at the Tiedemann Investment Group in New York. In 1998 he joined HSBC Investment Bank, where he worked in the Corporate Finance Department in the Energy & Utilities Team and in the Telecoms & Technology Team. Edward graduated from the University of Cambridge with a Master’s degree in Engineering and Management Studies.

Will Riley

Will joined Guinness Asset Management in May 2007, and is co-manager of Guinness Global Energy Fund, Guinness Sustainable Energy Fund and the Guinness Global Money Managers Fund.

Prior to joining Guinness, Will was employed by PricewaterhouseCoopers for six years, first in the London Middle Market Assurance Team, then as a valuation specialist in the Valuation & Strategy division. Will qualified as a Chartered Accountant in 2003 and graduated from the University of Cambridge with a Master’s Degree in Geography.

Jonathan Waghorn

Jonathan joined Guinness Asset Management in September 2013 and is co-manager of Guinness Global Energy Fund and the Guinness Sustainable Energy Fund.

Jonathan has 20 years’ experience in the energy sector. He was a Shell drilling engineer in the Dutch North Sea and worked as an energy consultant with Wood Mackenzie before becoming co-head of Goldman Sachs energy equity research in 2000.  He joined Investec as co-manager on the Investec Global Energy Fund in 2008 where he helped grow the energy franchise at Investec to a peak of nearly $3.5bn in 2011. Jonathan then joined Mercuria in 2012 to build an equities and fund management business based around the provision of external funds before joining Guinness Asset Management in 2013.

Investment process

Our stock selection is driven 50% by our top-down views and 50% by bottom-up stock analysis. The top-down views shape our energy sub-sector allocation, whilst bottom-up analysis is designed to identify the best stocks to populate our sub-sector allocation. The investment team applies a mixture of value and growth investing, with a bias towards value.

Top-down views

We conduct rigorous independent analysis of the fundamental drivers of sustainable energy markets: energy commodity prices; sustainable energy technology research and development; installation and equipment prices; political and economic support for the sector; government and private sector demand. This allows us to analyse likely demand for sustainable energy equipment and services and creates our top-down view, which in turn informs our industry energy sub-sector allocation. Analysis of the key drivers of growth, scarcity, barriers to entry and economics informs our weighting to our internally generated Sustainable Energy subsectors

Guinness stock screening
QualityReturn on investment
ValuationRelative to peer group and history
EarningsAnalysts’ earnings forecast revisions
MomentumPrice movements versus peers

Bottom-up stock screening

The team operates a disciplined stock screening process. We review a universe of around 179 sustainable energy stocks each week to identify companies which look attractive on their return on investment, valuation, earnings sentiment and price momentum. Other sub-sector specific screens are also employed to generate ideas.

Stock due diligence

Stock ideas are taken from our screens. We then conduct due diligence to establish whether we have conviction to include the stock in our portfolio. The due diligence centres around detailed financial modelling.

Portfolio construction

Equally-weighted portfolio

The portfolio comprises around 30 equally-weighted positions. Our equally-weighted portfolio construction is designed to create a balance between maintaining fund concentration and managing stock-specific risk. It also imposes a structural sell discipline: an existing position must be sold to purchase a new holding.

Sector weights

There is no benchmark adherence in the Fund’s sub-sector weights.

Portfolio risk controls

Stock specific risk

Stock specific risk in the sustainable energy sector tends to be higher than the broader market. By constructing the fund of 30 equally weighted positions, we avoid significant exposure to any one individual stock.

Emerging market exposure

There are no limits to emerging market exposure.

Liquidity

The portfolio is liquid, with 90% of the Fund normally invested in companies with a market capitalisation over US $500 million.

Currency

The Fund is not hedged from a currency perspective.

Fund Alternative Energy Fund Date (period end) 31.08.2018
Clean Energy Index Wilderhill Clean Energy Index Fund Launch 19.12.2007
New Energy Index Wilderhill New Energy Global Innovation Index Basis Total return, in USD

Please remember that past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise as a result of market and currency movement, and you may not get back the amount originally invested.

Cumulative performance (USD, %)
B class (OCF: 1.99%) Year-to-date 1 year 3 years 5 years From launch
Fund -4.71 1.81 1.24 -13.96 -75.97
Clean Energy Index 2.38 19.54 20.16 -2.64 -78.79
New Energy Index -8.16 0.72 19.13 29.43 -50.05
Annualised performance (USD, %)
B class (OCF: 1.99%) 1 year 3 years 5 years 10 years From launch
Fund 1.81 0.41 -2.96 - -12.47
Clean Energy Index 19.54 6.31 -0.53 -11.71 -13.48
New Energy Index 0.72 6.00 5.29 -5.23 -6.28
Calendar year performance (USD, %)
B class (OCF: 1.99%) 2013 2014 2015 2016 2017
Fund -12.05 -12.04 -15.44 20.17 -4.71
Clean Energy Index -16.93 -10.36 -22.12 39.81 2.38
New Energy Index -2.16 1.51 -6.43 28.90 -8.16
Discrete year performance to date (USD, %)
B Class (OCF: 1.99%) 12 months ending: Aug-14 Aug-15 Aug-16 Aug-17 Aug-18
Fund 24.45 -31.71 -1.37 0.82 1.81
Clean Energy Index 25.16 -35.26 -12.76 15.21 19.54
New Energy Index 35.94 -20.08 4.42 13.27 0.72
Source: Bloomberg, bid to bid basis, total return. The Fund also has Sterling and Euro share classes available for investors.

Latest Guinness Sustainable Energy Report

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Archive

Press

Investment Week | Oct '16

Is now the best time to access energy stocks
Samira Rüdig-Sotomayor discusses the Bull and Bear issues in the Alternative Energy sector

FT Adviser | Aug '15

Fund review: “things could be looking up”
FT Adviser’s Philip Scott profiles Edward Guinness’s Alternative Energy Fund.

Money Week | Jul '14

How might renewables change the face of energy?
Edward Guinness joins Money Week’s panel of experts discussing how investors can profit from the growth in renewable energy.

CNBC | Jun '14

VIDEO: How to be a winner in solar
Edward Guinness tells CNBC that solar remains a “high-growth area” and discusses how to invest in the sector.

Investment Week | Mar '14

Alternative energy recovery only just starting
Edward Guinness says alternative energy is only just starting to recover properly from the 2008 crisis, creating opportunities for investors.

Guardian | Feb '14

Windfall profits for 2013’s best fund

Patrick Collinson discusses the Fund’s power-packed returns from wind and solar investments

Blue & Green Tomorrow | Jan '14

Meet the manager of the 2013’s best fund
This Fund delivered returns that surpassed the entire UK fund world.

Citywire Global | Dec '13

Citywire profile: Power player returns to form
Alternatives expert Edward Guinness has been through the mill, but is now hitting a sweet spot

Seeking Alpha | Mar '13

A roaring return in alternative energy
Edward Guinness discusses the sector with Seeking Alpha

Insights

Mar '16

Gas vs Renewables
Edward Guinness and Samira Rudig discuss the effect of low fossil fuel prices on renewable technologies

Mar '14

Prospects for Alternative Energy
Edward Guinness discusses performance and prospects for alternative energy investing

Fact sheets
For information on the Fund’s current investments, please see the latest fact sheet: English French German Italian
Key facts
Launch date 19/12/2007 Pricing Daily, forwards
Fund managers (start date) Jonathan Waghorn (28/02/2019)
William Riley (28/02/2019)
Edward Guinness (19/12/2007)
Valuation 2300 Dublin time
Benchmark MSCI World Index;
Deal cut off time 1500 Dublin time
IA sector IA Global Year end 31 December
Structure OEIC (UCITS) Administrator Link Fund Administrators (Ireland) Ltd
Domicile Ireland Custodian JP Morgan Bank (Ireland) plc
Underlying currency US Dollar UK Reporting Fund status Yes
Redemption fee 2% within 30 days of purchase ISA Eligible Yes
Share classes
0.74% OCF 1.24% OCF 1.49% OCF 1.99% OCF
Currency USD, GBP, EUR USD GBP USD EUR USD GBP EUR
Accumulation or Distribution Acc Acc Acc Acc Acc Acc Acc Acc
Name Z E X A D B C C EUR Acc
Initial charge 0% 0% 0% 0% 0% 2% 5% 5%
OCF*
(Total ongoing charges p.a.)
0.74% 1.24% 1.24% 1.49% 1.49% 1.99% 1.99% 1.99%
Minimum direct investment £/€/$ 100,000,000* $10,000,000 £5,000,000 $200,000 € 100,000 $1,000 £1,000 € 1,000
Minimum platform investment Guinness Asset Management minimums do not apply. Platforms apply their own minimum investment levels.
ISIN Code GBP: IE00BFYV9L73 EUR: IE00BFYV9M80 USD: IE00BFYV9N97 IE00B3CCJ856 IE00B7LWDH14 IE00B2PGVJ29 IE00B3CCJ740 IE00B2PGVK34 IE00B3CCJ633 IE00BGHQF417
SEDOL GBP: BFYV9L7 EUR: BFYV9M8 USD: BFYV9N9 B3CCJ85 B7LWDH1 B2PGVJ2 B3CCJ74 B2PGVK3 B3CCJ63 BGHQF41
Bloomberg ticker GBP: GUIAEZG ID
EUR: GUIAEZE ID
USD: GUIAEZU ID
GUINAEE ID GUINAEX ID GUINAEA ID GUINAED ID GUINAEB ID GUINAEC ID GUINECE ID
Country registrations UK, CH, LUX, FIN, SGP
*OCF = Ongoing Charges Figure, which includes the annual management charge.

Country codes

UK
United Kingdom
CH
Switzerland
LUX
Luxembourg
FIN
Finland
SGP
Singapore (professional only)
GER
Germany
FR
France