abrdn’s director of investment strategy Robert Minter said the firm’s clients are seeking “exposure to the energy transition that’s coming.”
Minter told NYSE’s Judy Shaw that abrdn’s clients not only want “to get the theme correct, but also to get the implementation correct.” However, he noted that “a number of mistakes have been made” when entering the energy transition space. This includes targeting the wrong companies.
“You can get the theme right, but you miss on the implementation,” Minter said at Exchange 2023. “You don’t get the returns that you’re quite expecting.”
So, rather than track all the global electric vehicle companies, abrdn decided to target the metals these top-selling EVs need. This includes aluminum, zinc, and nickel, among others.
“We should have a vehicle for investors to participate in those trends of higher and higher demand for these minerals as we build out this energy transition,” Minter said.
Another problem is that “some of these new investments” in the energy transition space “don’t really have a track record.” That’s difficult “for a fund manager or an advisor to understand how… these investments react over time.”
The abrdn Bloomberg Industrial Metals Strategy K-1 Free ETF (BCIM) addresses both of these issues. Minter said that “although the fund is relatively new, the index, which the fund tracks, goes all the way back to 1990.”
“So, an advisor isn’t buying in the dark and just wondering how the strategy is going to work over time,” Minter said.
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