FTSE ET50- a new clean technology index 09.10.07
“There’s money in muck” goes the old Yorkshire expression. Well nowadays there is even more money in sorting muck out. The FTSE group have teamed up with Impax Asset Management to launch an index in clean technology companies.
From December 2007, FTSE will take over the calculation and management of the index, which will be rebranded the “FTSE ET50 Index” and will be available for investors to use as the basis of structured products, ETFs and index funds.
Impax Asset Management, a specialist investment manager in the environmental technology sector (which includes the alternative energy, water treatment, pollution control and waste management markets), designed and launched the ET50 Index in 1999 to measure the performance of companies whose core businesses is in the development and deployment of environmental technologies. Impax chose FTSE to take responsibility for the calculation of the ET50 Index because of FTSE’s proven indexing expertise and its commitment to providing investors with a set of responsible investment tools.
The FTSE ET50 Index comprises the largest fifty pure play environmental technology companies by market capitalisation worldwide. These are taken from a larger universe of over 500 global companies currently researched by Impax.
Will Oulton, Head of Responsible Investment at FTSE commented, “There is increasing global institutional investor interest in companies that will be best placed to succeed in a future low carbon world. The environment is now a key issue for global investors, and by applying the FTSE methodology to the ET50 Index, Impax and FTSE will provide an investible and transparent measure of the performance of the environmental technology sector for pension funds and asset managers globally.”
Ian Simm, Chief Executive of Impax, commented: “As one of the leading investment managers in the environmental sector, Impax has used the ET50 Index for over eight years as an informal benchmark of the sector’s performance. We are now delighted to be able to partner with FTSE to strengthen the foundations of the index and to make it available to investors worldwide.”
With investment in clean technology passing $1.1 billion in the first six months of 2007 the clean technology sector is one of the hottest industry sectors for investors. Following the spectacular crash of Bio Fuels Corporation share price, and it subsequent delisting from AIM in August the sector has been compared to the .com bubble era. However unlike the wilder .com years there are strong underlying factors- such as increased energy prices, peak oil, and climate change motivated legislation that clearly show that while not all the present players may survive the market is set for sustained growth into the future.
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