A BNP Paribas SA fund has gained 35% this year by wagering on winners in the renewable energy industry. Now its managers plan to bet against the losers.
Ulrik Fugmann and Edward Lees will run a new long/short fund, allowing them to bet against companies that are getting left behind in the transition to greener forms of energy. They’ll start with $50 million of assets under management, with the capacity for that to rise to $1 billion, Lees said in a phone interview.
The BNP Paribas Environmental Absolute Return Thematic fund, which starts up on Wednesday, will “short companies that are either sitting with significant transition-risk assets or stranded assets, or indeed have technologies that are either outdated or insufficient to address climate change,” Fugmann said. “Those companies will go down over time.”
The managers’ long-only BNP Paribas Energy Transition fund is outperforming 99% of its peers this year, according to data compiled by Bloomberg. Read More…