Michael Mainelli (Z/Yen) & James Palmer (BP)
This report is intended to provide an illustration of the application of portfolio modelling to climate change investment. Using data published by the IPCC, a Monte Carlo methodology is used to generate investment portfolios, measured in value by GHG abatement and carbon market financial returns. The resulting portfolios were then analysed for effectiveness €? revealing some high-level themes about what might be efficient portfolios for investors in climate change abatement.This methodology provides a starting point for investors wanting to construct a more sophisticated portfolio model for climate change.