Decode the Circular Economy and REthink the future
Transitioning to the Circular Economy is critical to ease demand on our planet’s natural resources and deliver sustainable economic growth. Regenerative by design, the Circular Economy minimises waste while providing a new world of opportunity for investors where preservation drives prosperity.
HSBC Asset Management is decoding the Circular Economy to enable investors to rethink their investments and become part of the solution. As part of this move forward, we are launching our HSBC GIF Global Equity Circular Economy fund.
What is a Circular Economy?
The demand on our planet’s natural resources is unsustainable.
Feeding into a global desire for positive change, the Circular Economy helps conserve and optimize finite resources while opening up investment opportunities and delivering sustainable economic growth.
Why should we act now?
*Data as at April 2020. Source: Message for Earth Day 2020
Current linear model: take, make, use, waste
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Exhaustion of natural resources and water pollution
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Soaring CO2 emissions and waste
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Deterioration of Biodiversity and living conditions
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All stakeholders are now embracing the circular economy transition
Regulations and Governments worldwide are moving fast forward on Circular Economy
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Society calls for action…
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Investors and companies are ready for circular economy integration
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1: January 2022, Visualized: The Circular Economy 101
2: June 2019, Plastic pollution facts and information
3: June 2022, Climate Change - United Nations Sustainable Development
4: May 2022, Waste and recycling
*IPCC = Intergovernmental Panel on Climate Change, **KPIs = Key Performance Indicators Source: HSBC Asset Management. June 2022. The commentary and analysis presented in this document reflect the opinion of HSBC Asset Management on the markets, according to the information available to date. They do not constitute any kind of commitment from HSBC Asset Management.
Circular Economy helps resolve the world’s most pressing challenges
Circular Economy delivers on several UN Sustainable Goals, especially:
Goal 12: Responsible Consumption and Production
Every second, the equivalent of a rubbish truck load of clothes is burnt or buried in landfill.
In a circular economy for fashion, products are used more, made from safe and recycled or renewable inputs, “made to be remade”, recycled or composted. Hazardous substances to health or the environment are designed out3.Goal 6: Clean Water & Sanitation
72 per cent of all water withdrawals are used by agriculture4. The most impacted regions (West Asia, Pacific) export scarce water through food and cotton products to net importers like Europe and North America.
Efficient textile and food production means massive decrease in water stress in Asia.
1: January 2022, Visualized: The Circular Economy 101
2: The Global Circularity Report 2021
3: Source: Fashion and a circular economy | Ellen MacArthur Foundation
4: February 2021, Scarcity | UN-Water
Source: HSBC Asset Management, June 2022. The commentary and analysis presented in this document reflect the opinion of HSBC Asset Management on the markets, according to the information available to date. They do not constitute any kind of commitment from HSBC Asset Management.
Why consider investing in Circular Economy
Hear from our expert
Bénédicte Mougeot, SRI Equity Fund Manager and Head of Climate Equity presents our Circular Economy investment strategy.
An opportunity for investors
Investing in solutions to the long-term sustainability challenges we face offers an added benefit for those who want their capital to contribute to improved outcomes beyond investment returns.
Companies
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* ROCE = Return on capital employed
Customers
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Society
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Key risks
The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. Further information on the potential risks can be found in the Key Investor Information Document (KID) and/or the Prospectus or Offering Memorandum.
- Capital loss risk: It is important to remember that the value of investments and any income from them can go down as well as up and is not guaranteed. Equity risk: Funds that invest in securities listed on a stock exchange or market could be affected by general changes in the stock market. The value of investments can go down as well as up due to equity markets movements
- Small & Mid cap risk: Please note that the fund is invested in securities issued by companies which, due to their small or mid market capitalization, are less liquid and may present higher risks
- Foreign Exchange risk: Where overseas investments are held, the rate of exchange of the currency may cause the value to go down as well as up. Variations in exchange rates between currencies can have a significant impact on the performance of the products presented
- Emerging market risk: Investments in emerging markets have by nature higher risk and are potentially more volatile than those made in developed countries. Markets are not always well regulated or efficient and investments can be affected by reduced liquidity
Risk and Reward Profile
The rating is based on price volatility over the last five years, and is an indicator of absolute risk. Historical data may not be a reliable indication for the future. The scale varies from 1 (least risky) to 7 (most risky). The rating is not guaranteed to remain unchanged and the categorisation may shift over time. The lowest rating does not mean a risk-free investment. Do not run any unnecessary risk. Read the Key Investor Information Document. The fund invests in instruments of high level of volatility. The value of investments can go up as well as down.
Before subscription, investors should refer to the Key Investor Information Document (KIID) of the fund as well as its complete prospectus. For more detailed information on the risks associated with this fund, investors should refer to the prospectus of the fund.
The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. Past performance is not a reliable indicator of future performance. Any views and opinions expressed are subject to change without notice. Any forecast, projection or target where provided is indicative only and is not guaranteed in any way. We accept no liability for any failure to meet such forecast, projection or target. This page is prepared for general information purposes only and does not have any regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive it. Any views and opinions expressed are subject to change without notice. This document does not constitute an offering document and should not be construed as a recommendation, an offer to sell or the solicitation of an offer to purchase or subscribe to any investment.