Cumulus Unveils Climate Change Fund

Feb 4 2008 | 5:09pm ET

A London-based hedge fund shop hopes to turn global warming into hot returns with its latest investment offering.

Cumulus Funds has launched a climate change fund, targeting returns of between 15% and 20%. The long/short equity fund, which will focus on the financial impact of climate change, has very low correlation with the equities markets, the firm said.

“Several fund management groups are seeking to take advantage of climate change investment opportunities—but none have our blend of investment track record, scientific credentials or practical experience advising over 150 leading international companies on weather risk management,” James Hulse, the new fund’s manager, said.

Cumulus, which manages US$250 million, said it has run the strategy on paper for the past 16 months, producing annualized returns of more than 15%.

“The Cumulus team has great depth and breadth of experience in trading energy, carbon emissions, agricultural commodities and weather derivatives and we are very excited about applying this expertise to the new Cumulus Climate Fund,” Peter Brewer, Cumulus chief investment officer, said.

Cumulus—fittingly—runs a weather fund and energy commodities fund in addition to the new offering. Hulse and the firm’s weather equity team will manage the new fund, alongside new hire Ian Thomas, who joins the firm as head of equity research.

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