Massive withdrawals by environmentally conscious institutional investors from oil and gas sectors are boosting the earnings of hedge funds as energy prices rise, FT reports.
Hedge funds have remained bullish on products in the oil and gas sectors, taking up sizable positions that have been dumped by ESG oriented institutional investors.
Hedge fund managers see a lot of potential in the oil and gas sectors and say the investment is highly needed in them, given that energy prices continue to soar. They opine that earnings from the oil and gas sectors can be used to fund a move to clean energy.
Odey Asset Management is up at least 100% this year. The company has significant stakes in energy companies such as Aker, whose shares have risen by 43% this year, and Jadestone Energy, whose stock has gained by 44%.
Analysts say the exit of big institutions is leaving hedge funds with attractive opportunities, although this could expose them to risks if energy prices plunge on massive selling by the big investors. NG1! is down -0.67%, CL1! is down -0.58%