SCBAM offers climate change fund
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SCBAM offers climate change fund

Mr Narongsak says investing in climate change-related activities offers long-term growth potential.
Mr Narongsak says investing in climate change-related activities offers long-term growth potential.

As the Thai stock market stagnates, SCB Asset Management (SCBAM) is launching the Global Climate Change Fund (SCBCLIMATE) to attract investors eager to cash in on global trends.

The fund, a pioneer in Thailand, invests in businesses related to reducing greenhouse gas (GHG) emissions to mitigate the impact of climate change, creating opportunities for investment portfolios to grow in the long term, said SCBAM chief executive Narongsak Plodmechai.

"Climate change is a threat the world is focusing on as its impact intensifies," he said.

Global temperatures are projected to increase by about 1.5°C by 2050 and 2-4°C by 2100, said Mr Narongsak.

A total of 194 countries and the EU signed the Paris Agreement to reduce their emissions and work together to adapt to the impact of climate change.

Investing in climate change-related activities offers long-term growth potential, said Mr Narongsak.

SCBCLIMATE, which is offered for sale from June 11-17, utilises the Templeton Global Climate Change Fund as the master fund, managed by Franklin Templeton, a leading investment manager.

The master fund has an aggressive investment policy in core value stocks of global companies focused on reducing carbon dioxide emissions.

The policy diversifies investments in stocks of all sizes in several industries through two investment themes, including solution stocks, meaning companies that derive most of their income from products and services that reduce GHG emissions, or have developed efficient use of resources.

The other theme involves transition, picking stocks of companies that are growing into full solution providers.

Craig Cameron, manager of the master fund, said three important factors must be monitored, including how business sectors adopt alternative energies, such as solar power systems, or producing electric vehicle batteries that use lithium as a raw material.

Second, interest rates are likely to be cut in the next few quarters, which will help stimulate the economy and increase access to long-term capital for climate-related investments, he said.

Finally, the fund has to monitor investment diversification of various industries as it provides opportunities for companies with fundamental values to accommodate climate change contingencies, said Mr Cameron.

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