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 - The electrification of transportation and improved energy storage economics brings attractive long term sustainable energy demand growth
- Improving Economics - Sustainable energy sources have become cost competitive with power from fossil fuels; we expect the cost of supply to continue to fall
- 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
Overview | |
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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 |
Video
Reports
Quick links
Update | Jan '21
Webcast | Jan '21
Insight | Oct '20
- In brief: why invest in sustainable energy?
- Why invest in the Guinness Sustainable Energy Fund
- Fund managers
- Investment process
- Portfolio construction & risk controls
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?
- 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
- 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
- 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
- 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
- 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
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 Quality Return on investment Valuation Relative to peer group and history Earnings Analysts’ earnings forecast revisions Momentum Price 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.
- Concentrated Exposure
Fund | Alternative Energy Fund | Date (period end) | 31.08.2018 | ||
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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, %) | |||||
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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, %) | |||||
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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, %) | |||||
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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, %) | |||||
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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 |
Latest Guinness Sustainable Energy Report
Jan '21
Dec '20
Nov '20
Oct '20
Sep '20
Aug '20
Jul '20
Jun '20
May '20
Apr '20
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
Key documents
Fact sheets | ||||
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For information on the Fund’s current investments, please see the latest fact sheet: | English | French | German | Italian |
Key facts | |||
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Launch date | 19/12/2007 | Pricing | Daily, forwards |
Fund managers (start date) | Jonathan Waghorn (28/02/2019) William Riley (28/02/2019) |
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 | Brown Brothers Harriman |
Underlying currency | US Dollar | UK Reporting Fund status | Yes |
ISA Eligible | Yes |
Share classes |
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Class | OCF current | Max. Initial Charge | Min. Investment | ISIN | SEDOL | Bloomberg |
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Guinness Sustainable Energy Fund C EUR Acc | 1.99% | 5% | €0 | IE00BGHQF417 | BGHQF41 | GUINECE ID |
Guinness Sustainable Energy Fund C GBP Acc | 1.99% | 5% | £0 | IE00B3CCJ633 | B3CCJ63 | GUINAEC ID |
Guinness Sustainable Energy Fund C USD Acc | 1.99% | 5% | $0 | IE00B2PGVK34 | B2PGVK3 | GUINAEB ID |
Guinness Sustainable Energy Fund D EUR Acc | 1.49% | 0% | € 0 | IE00B3CCJ740 | B3CCJ74 | GUINAED ID |
Guinness Sustainable Energy Fund D USD Acc | 1.49% | 0% | $0 | IE00B2PGVJ29 | B2PGVJ2 | GUINAEA ID |
Guinness Sustainable Energy Fund I USD Acc | 0.99% | 0% | $10,000,000 | IE00BMYPNB63 | BMYPNB6 | |
Guinness Sustainable Energy Fund Y EUR Acc | 0.74% | 5% | € 0 | IE00BFYV9M80 | BFYV9M8 | GUIAEZE ID |
Guinness Sustainable Energy Fund Y GBP Acc | 0.74% | 5% | £0 | IE00BFYV9L73 | BFYV9L7 | GUIAEZG ID |
Guinness Sustainable Energy Fund Y USD Acc | 0.74% | 5% | $0 | IE00BFYV9N97 | BFYV9N9 | GUIAEZU ID |