Investing in a low-carbon economic era

Growth will come from technology disruptors, says AGF's Hyewon Kong.

Michael Ryval 16 June, 2016 | 5:00PM

Economic development since the Industrial Revolution has moved in 40- to 60-year eras, with each era being succeeded by another. For instance, the so-called age of steel, electricity and heavy engineering between 1870 and 1910 was followed by the age of oil, automation and mass production between 1908 and 1970.

And each era was characterized by difficult transitions which challenged the established order, yet also created investment opportunities, according to Hyewon Kong, associate portfolio manager at Toronto-based AGF Investments Inc., and co-manager of the $46-million AGF Global Sustainable Growth Equity. "What is driving the transition is that the cost curve has to come down a lot," she says. "At the beginning of the auto era, for instance, it was very expensive. But mass production can only be achievable by the cost curve coming down a lot."

Since about 2000, Kong argues, the world has been transitioning to a low-carbon, "green" economy, which has encouraged a host of companies that have developed innovative solutions for the world's social and environmental challenges.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Acuity Brands Inc94.31 USD4.85
Hannon Armstrong Sustainable Infrastructure Capital Inc30.10 USD1.21
Toray Industries Inc4.96 USD10.64

About Author

Michael Ryval

Michael Ryval