| Monthly comment for January |
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2010-02-02 Investor risk aversion increased in the first month of the new year due to fear of government indebtedness (the cost of insuring against "state bankruptcy" in Greece and Portugal rose dramatically during the month), a more contractionary monetary policy in China as well as questions about how sustainable the economic recovery in the U.S. is. All factors contributed to lowering the mood in world stock markets; particularly in Asia where the leading indices were down five of the last six trading days. As a result of the negative market sentiment World index fell by 1,04% during the month while the fund lost 1,69%. The fund developed significantly better than the index for both renewable energy and environmental technologies, which traded down by 7,61%, and the water index which lost 2,86%. The main reason for the weak performance of the index for renewable energy and environmental technologies was the move by the German Environment Minister to sharply and imminently cut the feed-in-tariffs for the solar sector. The proposal was presented in the middle of the month and prescribes a slash in feed-in tariffs by 15% from the first of April this year. The German market represents about 40% of the global market and this proposal can - as expected by many pundits - imply a halving of this market. That would in turn cause a reduction in the global market for installed solar power by 20% while prices are expected to fall in line with volume, i e about 20%. Our assessment, based on these assumptions, is that a market correction of about 20% in the solar sector is reasonable, all other things being equal. However, the broad solar index has at the end of January shed 20,2% since the proposal, why we now consider the proposal fully priced in by the market. Read the monthly report here 
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The fund in short
Save Earth Fund invests in renewable energy, environmental technology and water management through actively managed funds, ETFs and stocks. The fund is the only of its kind in Sweden. Our aim is to generate a return that clearly exceeds that of the MSCI World index, with a lower than the average risk of environmental funds. No minimum investment. The management fee is 1%. Daily subscriptions/redemptions. Mr Carl Bernadotte, Mr Alexander Jansson and Mr Marcus Grimfors are responsible for managing the fund. Learn more about our managers here. |