How net-zero strategies can co-exist with active investing
Produced in partnership with Northern Trust Asset Management.
If it were true that investors can’t achieve net zero targets without introducing an unacceptable level of tracking error to portfolios, that is by taking on an unacceptable level of active risk, then there would be a strong argument that achieving net-zero targets conflicts fundamentally with efficient active investing.
But the idea that net-zero strategies can’t exist within an active management framework is a myth that is easy to debunk, says Northern Trust Asset Management head of quantitative strategies, international, Guido Baltussen.
Baltussen says many popular net-zero strategies, both active and passive, do tend to diverge significantly from their…
