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UBS says investors should prefer green bonds over regular debt

By David Caleb Mutua, Bloomberg


Highlights

  • According to UBS Global Wealth’s head of credit, Thomas Wacker, sustainable bonds are a “defensive opportunity” that credit investors should favor over non-green, investment-grade corporate notes
  • The fossil fuel industry has no presence in the green bond market and are feeling the impacts of the turning economy due to the COVID-19 pandemic
  • According to Bloomberg, Barclays U.S. Green Bond Index is down 2.5% so far this year compared to the 5.1% drop seen in the corporate debt benchmark
  • Investors that own green bonds tend to hold on to sustainable debt when selling down a portfolio because of their scarcity
  • The long-term nature of green energy projects like wind parks means that they weather this kind of downturn better

Fossil fuel divestment and the transition to 100% clean electricity a major step towards achieving the Climate Center’s Climate-Safe California Platform.


Read More: https://www.bloomberg.com/news/articles/2020-03-30/ubs-says-investors-should-prefer-green-bonds-over-regular-debt