In this series of short profiles, we ask leading fund managers to defend their investment strategies, reveal their views on cryptocurrency, and tell us what they'd never buy.
This week our interviewee is Jon Wallace and Noelle Guo of the 4-globe rated Jupiter Green Investment Trust (JGC).
Which Sector Shows the Biggest Promise in 2023?
We see compelling opportunity in the Clean Energy theme this year. We are still living through an energy shock globally, with clean energy able to provide solutions. We think investment markets don’t yet reflect that 2023 is likely to be a year when clean energy projects accelerate again. Supportive policy for both supply and demand side, easing supply chain disruption and fading cost inflation are all positive catalysts for clean energy deployment after a slight pull back in certain markets last year.
What's the Biggest Economic Risk Today?
Runaway climate change – real world climate change is accelerating quicker than anticipated, and the potential knock-on impacts could be enormous across all sectors. Solving the environmental challenges facing humanity right now will define this decade and this century.
Describe Your Investment Strategy
In a nutshell, it follows long-term, green structural growth.
We have a long-held conviction that environmental challenges are central to global development, with environmental solutions currently crossing a watershed moment where they are no longer deemed peripheral, but instead are integral to the success of future economies and markets.
We invest in companies that we believe are positioned to benefit from these trends by enabling the solutions to environmental challenges, with a focus on climate mitigation, adaptation and natural capital restoration. We look to investments that are making a material contribution in six critical environmental solutions themes: Clean Energy, Green Mobility, Green Buildings & Industry, Sustainable Agriculture & Land Ecosystems, Sustainable Oceans & Freshwater Systems and Circular Economy.
Which Investor Do You Admire?
Noelle: I admire investors who keep a cool head in hot markets, who are willing to get into the weeds of the details, but never lose sight of the bigger picture. Ray Dalio and Howard Marks for example - both have a very different investment style to our strategy at Jupiter Green, but provide inspiration, nonetheless.
Jon: For me, Jeremy Grantham springs to mind; he’s very long-term minded, and a big advocate of climate investing.
Name Your Favourite 'Forever Stock'
Do they even exist? We are not so sure. The nature of our investment approach embraces a world that is constantly changing, and needs to change. We invest for the long-term, but what works well now won’t always work.
What Would You Never Invest In?
We never invest in companies we don’t understand.
Growth or Value?
Growth, without a doubt.
House or Pension?
Both if you can! But if pushed to pick one we would probably go for a house – it’s a long term inflation-hedged investment and can always be drawn on (i.e. sold/downsized) to fund one’s pension needs later on.
Crypto: Brilliant or Bad?
We don’t have a view because – as indicated above with question 6 – we don’t understand it!
What Can be Done to Improve Diversity in Fund Management?
Approach building an investment team like you would a portfolio – by diversifying it. To a large extent, change must come from the top. Ensuring that senior management incentives are aligned with diversity targets is key if we are to ensure that everyone has a seat at the table.
Have you Ever Engaged with a Company and Been Particularly Proud (or Disappointed) in the Outcome?
A small part of what we do is linked to earlier-stage businesses, particularly when we spot their potential to transform sectors. We’re proud of how they are working towards real, impactful change and will become meaningful positions within the portfolio as time goes on. Even if we aren’t invested, we meet nascent businesses and feedback – everyone has a responsibility to help the environmental economy flourish in a multitude of ways.
What’s the Best Advice You’ve Ever Been Given?
Noelle: Be humble when markets go up, don’t lose your conviction when markets go down.
Jon: Don’t follow your intuition, but do listen to it and never ignore it.
What Would You be if You Weren’t a Fund Manager?
Noelle: I was one PhD away from becoming an economist!
Jon: I would have likely stayed in management consulting, which is where I originally started my career. I thought I would go back into that after an MSc in Environmental Technology, but I’m grateful the direction of my life led me into fund management instead.
