02 May 2007

Global Climate Change: New Index Allows Investors to "Bet" on Companies Tackling Global Warming

Planet Ark/Reuters reports this morning that a Boston-based group, KLD Research & Analytics, has licensed an index that allows investors to "bet" on companies taking steps to combat global warming. It's an interesting development for investors looking to make a play in sectors that are tackling this issue.

Here is the complete report from Reuters News Service:

KLD says its Global Climate 100 Index holds small to large-cap companies whose activities reduce the social and economic consequences of climate change.
The weighted index holds 100 companies ranging from the energy and utility sectors to industrials and consumer products. Some of the companies invest in efficiency and buy power from renewable sources.

That differentiates the index from pure-play renewable energy investment products, KLD spokesman Chris McKnett said.

"We are trying to provide investors exposure to the global climate solutions value chain. The sources of climate change are dispersed across the economy and our view is that sustainable solutions also have to be dispersed across the economy," he said in telephone interview.

Last quarter the index achieved a return of 5.87 percent and annualized returns since the index's inception in the summer of 2005 were 22.38 percent, KLD said.

Among companies the index holds are Whole Foods Market, Inc., which purchases renewable energy credits to offset 100 percent of its electricity needs in North America, and Itron, Inc., which manages the delivery and use of energy and water to increase efficiency.

It also holds Japanese company Sekisui Chemical Co. , which has built homes that operate on solar energy since 1998.

KLD licensed the index with Fixed Income Securities, L.P.

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