TargetNetZero equity

    TargetNetZero Global & Europe Equity

    Net Zero is about investing in the transition.

    At Lombard Odier, we believe that investors need to re-think their approach to net zero.

    Although the industry has started to understand the urgency around decarbonisation, many of the solutions available in the market are simplistic, do not sufficiently address the problem and, in some cases, significantly increase the risks and biases within portfolios.

    Our TargetNetZero equity funds have a wide range of climate objectives covering the risk of transition, the opportunities and the physical risks associated with climate change.

    Portfolios include companies already targeting net zero CO2 emissions by 2050, as well as those without such targets but who may be brought into line through regulatory action, investor engagement and market changes.

    To learn more about why low tracking error solutions are useful vehicles to benefit from climate transition, click here to read our paper.

     

    TargetNetZero: A focus on the  reduction in emissions across the economy

     

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    1. Investors need to act now
    The urgent need to reduce carbon in the environment, if we are to prevent a climate catastrophe and its devastating social impacts, is now widely accepted. 

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    2. The numbers are staggering1
    • We currently emit 52 billion tons of CO2 today. Every year
    • To keep global warming within 1.5 degrees, by 2050, net emissions must fall to zero 
    • And, to hit that target, greenhouse gas emissions must fall 50% by 2030.

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    3. Exclusions lead to missed investment opportunities
    The simplistic approach of exclusions fails to recognise that the greatest positive impact on decarbonisation will come from companies that are currently high emitters and that have the commercial need and financial resources to transition to a much lower level of emissions in the future.

    Source: LOIM. For illustrative purposes only. 1World Resources Institute; excludes land use change.

    Why invest?

    Aligning to the climate transition, our equities funds are aimed at accelerating the transition to net zero.

    Carbon footprints alone do not tell us the full picture of climate risks in a portfolio. We believe that maintaining a diversified portfolio that identifies companies on a strong decarbonisation path, irrespective of sector, will help accelerate the transition to net zero and provide compelling returns for investors.
    ~ Hubert Keller, Senior Managing Partner of Lombard Odier

    A holistic approach from LOIM spanning the widest opportunity set:
    i. Reduce carbon footprints
    ii. Reduce climate transition risk
    iii.Offer a viable route for investing across the entire economy
    iv. Accelerate climate transition
    v. Maintain portfolio diversification
    vi. Target climate growth opportunities


    Seeking greater climate impact while decarbonising at a faster rate.
    The sustainability lens provides greater confidence in the assessment of issuers to separate the winners and losers and capture long-term opportunities in decarbonisation.

    • Benchmark: MSCI World/Europe2
    • Integrate ESG scores: targeting to be in line or better than the benchmark2
    • Controlled: factor/style, sector, country bias
    • Low tracking-error: 0.5%-1% ex-ante

     

    Compared to our peers, at Lombard Odier Investment Managers, we aim to deliver on three parameters:

    Redeployment of capital

    Rising awareness

    Market forces

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    Reducing the transition risk for investors. Thus generating risk-adjusted returns as our global economy shifts from WILD to CLICTM 3

    Offering an investment opportunity in line with the climate goal to limit greenhouses gases and consumer demand.

    New targets and regulations are increasingly focused on circularity, nature, equality and net zero. Technological innovation and economies of scale are driving down the costs of CLICTM solutions.3

     1Source: For illustrative purposes only. MSCI World for the sub-fund TargetNetZero Global Equity & MSCI Europe for for the sub-fund TargetNetZero Europe Equity respectively. No benchmark/index is directly comparable to the investment objectives, strategy or universe of a fund. 3 ‘WILD’: Wasteful, Idle, Lopsided, Dirty. CLICTM: Circular, Lean, Inclusive, Clean economic model. 

     

    Investment philosophy and process.

    At Lombard Odier Investment Managers, we incorporate proprietary sustainability tools and expert intelligence to align temperature target.

    Our investment philosophy: a flexible, disciplined, and transparent approach to deliver sustainable returns.

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    Source: LOIM analysis. For illustrative purpose only. Sustainable Investment Research Strategy & Stewardship (SIRSS) and Environment, Social and Governance (ESG) are LOIM's transversal sustainability teams. 1 “Ice cubes” that are significantly reducing global warming. 2 “Burning logs” that are significantly increasing global warming. 3 Coal power, coal mining, unconventional oil and gas. There can be no assurance that investment objectives will be achieved or that there will be a return on capital.

     

    Investment team.

     

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    Laurent Joué
    Head of Systematic Alternatives & Equities 

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    Nicolas Mieszkalski
    Portfolio Manager – Systematic Equities
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    Alexey Medvedev, PhD
    Deputy Portfolio Manager – Systematic Equities

    +1 Portfolio Manager and 1 analyst

     

    Sustainable Investment Research, Strategy & Stewardship team (SIRSS)

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    Christopher Kaminker, PhD FRGS 
    Head of SIRSS

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    Maxime Perrin 
    Head of Sustainable Investment
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    Dr Thomas Hohne-Sparborth, PhD
    Head of Sustainability Research

     

    +17 sustainability experts and sector analyst

     

     

    Important information.

    Lombard Odier Funds (hereinafter the “Fund”) is a Luxembourg investment company with variable capital (SICAV). The Fund is authorised and regulated by the Luxembourg Supervisory Authority of the Financial Sector (CSSF) as an Undertaking for Collective Investments in Transferable Securities UCITS under Part I of the Luxembourg law of the 17 December 2010 implementing the European directive 2009/65/EC, as amended (“UCITS Directive”). This marketing document relates to “TargetNetZero Europe Equity and TargetNetZero Global Equity,” Sub-Funds of Lombard Odier Funds (hereinafter the “Sub-Fund”). The Management Company of the Fund is Lombard Odier Funds (Europe) S.A. (hereinafter the “Management Company”), a Luxembourg based public limited company (SA), having its registered office at 291, route d’Arlon, 1150 Luxem-bourg, Grand Duchy of Luxembourg, authorised and regulated by the CSSF as a Management Company within the meaning of EU Directive 2009/65/EC, as amended; and within the meaning of the EU Directive 2011/61/EU on Alternative Investment Fund Managers (AIFMD). The purpose of the Management Company is the creation, promotion, administration, management and the marketing of Luxembourg and foreign UCITS, alternative investment funds (“AIFs”) and other regulated funds, collective investment vehicles or other investment vehicles, as well as theoering of portfolio management and investment advisory services. This marketing communication was prepared by Lombard Odier Asset Management (Europe) Limited. The prospectus, the articles of incorporation, the Key Investor Information Documents, the subscription form and the most recent annual and semi-annual reports are the only official offering documents of the Sub-Fund’s shares (the “Offering Documents”). The Offering Documents are available in English, French, German and Italian at www.loim.com and can be requested free of charge at the registered office of the Sub-Fund in Luxembourg: 291 route d’Arlon, 1150 Luxembourg, Grand Duchy of Luxembourg. The information contained in this marketing communication does not take into account any individual’s specific circumstances, objectives or needs and does not constitute research or that any investment strategy is suitable or appropriate to individual circumstances or that any investment or strategy constitutes a personal investment advice to any investor. This marketing communication is not intended to substitute any professional advice on investment in financial products. Before making an investment in the Sub-Fund, an investor should read the entire Offering Documents, and in particular the risk factors, costs and conditions pertaining to an investment in the Sub-Fund. We would like to draw the investor’s attention toward the long- term nature of delivering returns across the economic cycle and the use of financial derivative instruments as part of the investment strategy may result in a higher level of leverage and increase the overall risk exposure of the Sub-Fund and the volatility of its Net Asset Value. Investors should take care to assess the suitability of such investment to his/her particular risk profile and circumstances and, where necessary, obtain independent professional advice in respect of risks, as well as any legal, regulatory, credit, tax, and accounting consequences. There can be no assurance that the Sub-Fund’s investment objective will be achieved or that there will be a return on capital. 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You can lodge a claim via your Relationship Manager or directly to Lombard Odier (Europe) S.A. Luxembourg, Belgium Branch, Claim Management Service, Avenue Louise 81, Box 12, 1050 Brussels, Fax: (+32) 2 543 08. Alternatively you can address your complaint free of charge to the national complaint service in Belgium, OMBUDSMAN: North Gate II, Boulevard du Roi Albert II, n°8 Boîte 2 2, 1000 Brussels, Tel: (+32) 2 545 77 70, Fax : (+32) 2 545 77 79, Email: Ombudsman@Ombusfin.be. France – Centralising agent: CACEIS Bank. Germany – German Information and Paying agent: DekaBank Deutsche Girozentrale. Italy – Paying agents: Société Générale Securities Services S.p.A., State Street Bank International GmbH – Succursale Italia, Banca Sella Holding S.p.A., Allfunds Bank S.A.U., Milan Branch, BNP Paribas Securities Services, CACEIS Bank, Italy Branch. Liechtenstein – Paying agent: LGT Bank AG. 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