Energy and infra

Renewable energy and infrastructure as investment targets

Infrastructure and renewable energy are investment areas whose importance is growing as social structures and energy needs change. The infrastructure sector covers critical services ranging from electricity and gas distribution to water supply, ports, airports, and road networks. These markets are typically characterised by limited competition and a stable operating environment, which promotes more stable long-term returns. Infrastructure investments have traditionally been the domain of large players, but current solutions are also making them accessible to private investors.

Investments in renewable energy focus on wind and solar power and the technology and infrastructure that support them, such as energy storage and the hydrogen industry. The sector is growing rapidly as energy production becomes more electrified and the green transition progresses across Europe. Renewable energy projects offer long-term return potential and have low correlation with traditional equity and fixed income investments, which increases the diversification benefits of a portfolio.

UB Renewable Energy Fund

Renewable energy has the potential to replace fossil fuel energy sources. UB Renewable Energy Fund invests in wind power, solar power, and innovative renewable energy solutions, especially in Finland. The fund both develops greenfield wind power projects and invests in brownfield renewable energy projects already in operation. 

The key role of infrastructure in real assets

The case for a strategic allocation to global listed infrastructure is compelling. The asset class has delivered attractive annualised total returns over the long-term, often outpacing both global equities and bonds.

An investment in global listed infrastructure should be seriously considered in any mixed-asset portfolio, or as a complement to a private infrastructure allocation. Key benefits of listed infrastructure are attractive net total returns (both yield and capital), relatively stable cash flows generally linked to inflation as well as a diversification across regions and sub-sectors. 

Listed infrastructure is an attractive proxy for private infrastructure investment over the medium to long-term, offering transparency and liquidity versus private investment. It is a strategic investment priority worldwide.

Over time, infrastructure assets have exhibited relatively stable cash flows and an element of inflation protection, which hold considerable appeal for investors who focus on both yield and offsetting or hedging their long-term liabilities.

According to the 2019 Global Infrastructure Report by Preqin Ltd, a leading provider of financial data and information on the alternative assets market, infrastructure plays an increasing role in institutional portfolio allocations. The report highlights that more than half of the institutional investors surveyed plan to increase their allocation to infrastructure over the long term. A balanced, blended approach to infrastructure investment provides stable income, global diversification and transparency within a cost-effective framework.

UB Asset Management is a member of the Global Listed Infrastructure Organisation (GLIO), the representative body for the $2.5 trillion market capitalisation listed infrastructure asset class.