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Leading Hedge Fund Confirms Renewable Investment Strategy

15 Sep 14:00 by Steve Walia

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Lansdowne, the leading private equity fund, has confirmed that it will be investing in the renewable energy sector in a move that will signal positivity to other investors. The fund will be purchasing long positions in firms that make the equipment and technologies used for renewable energy manufacturer, as well as direct providers of innovative green power technologies and other firms working in the renewable energy sector.

Other private equity companies such as KKR and Carlyle are also making investment moves into renewables, but as yet few hedge funds have changed their strategies to focus wholly on this sector. DE Shaw is an exception, and the firm has already created a fund that will directly purchase green power assets in America.

The news is even more positive in the wake of SunEdison's bankruptcy earlier this year, which burned several large hedge funds. SunEdison had previously been one of the biggest companies in the renewable power space, but it failed after over-extending its debt position in order to fuel a number of unsustainable acquisitions.

Lansdowne believes that the right time to invest in renewables is now and that the sector's stocks are devalued thanks to the costs of solar and wind energy production continuing to plummet and interest from consumers continuing to grow.

Investment in renewables is also growing on a global scale and has risen over the past ten years to $329 billion in 2015, compared to just $62 billion in 2004. Since the Paris summit last December, however, the new accord has helped to boost the sector once again, supported by continually falling costs in green energy production.

The new clean energy fund offered by Lansdowne has already received significant interest from institutional investors as well as other bodies keen to operate with ethical values.