We work with our clients to understand and appreciate their objectives and constraints. Through these client-focused partnerships, our research capability is then put to good use to tease out the implications of these requirements.
What follows is an iterative approach where clients can prioritise objectives and constraints, and effectively tailor an individual strategy in line with their aim to achieve a desired outcome. These strategies can include any combination of quantitative or ESG factors, as well as risk budgets, exclusions and other constraints.
Importantly, it’s not a set and forget approach. We regularly report on the outcomes and can quickly adapt strategies to correct for changes in client requirements.
Strategy in focus - Low Carbon Quant Portfolios
Since 2012, our Quantitative Equities team have been researching and implementing low carbon portfolios.
We know there are many ways to lower the carbon exposure of a listed equities portfolio. Strategies we currently implement for institutional investors include using metrics like Weighted Average Carbon Intensity (WACI) and Potential Carbon. We also run strategies based on Carbon Footprint metrics and can incorporate measures of transition towards a low carbon economy.
Our advanced research capability – complemented by our dedicated Sustainable Investment team specialists – helps to ensure our strategies are tailored to investors’ ESG and low carbon requirements.
Once an investor implements a core low carbon portfolio, they are able to add enhancements. For example, portfolios can be tilted toward companies that are involved in the low carbon transition, are amenable to the Sustainable Development Goals (SDG) or have high specific ESG scores. Portfolios can also screen out companies that do not meet certain criteria.