A groundbreaking partnership between Thomas Schumann Capital® and Anatase Ltd, two solutions providers committed to increasing water security through responsible investing, will launch the world’s first index family to benchmark water risk in global capital markets on January 4, 2021.
The TSC Water Risk Index® is a systematic, rules-based thematic investment strategy designed to provide both financial performance and to advance a water-secure future. As a leading solutions provider at the intersection of water security and responsible investing, Thomas Schumann Capital’s investment ethos is guided by support for the UN Sustainable Development Goals framework, in particular, SDG 6 – sustainable management of water. The innovative suite of indices helps forward-looking investors to anticipate, and capitalize upon, listed companies’ growing exposure to the financial and operating risks created by future reduced access to water resources, while rewarding good corporate water stewardship.
“Nearly a third of the world is subject to water stress, a burgeoning crisis that only promises to get worse,” says Thomas Schumann, founder of Thomas Schumann Capital®, who believes that addressing water as a core portfolio risk and long-term investment opportunity is a key strategy for capturing both sustainable performance and positive environmental impact. Schumann explains that “investors are shifting their focus to water risk as a proxy for climate risk because as climate change exacerbates droughts and flooding, and as population growth fuels the ever-growing demand for water, operating and financial risks to businesses will rise. Looking ahead, we believe that companies with good water management practices are positioned to be tomorrow’s market winners.”
Anatase LTD’s CEO, Markus Barth, a veteran index architect, is likewise committed to responsible investing. Said Barth, “We are excited to be collaborating with Thomas Schumann Capital® to incorporate their innovative proprietary measurement of water risk into investable, liquid equity indices.” He added that “we intend to leverage our 30 years of experience in index development and monetization with TSC's groundbreaking water risk metrics, in order to create the first-ever investment solution that enables investors to earn equity market returns while mitigating the potential negative impact of water risk."
In the five-year back-test from October 30, 2015 through November 30, 2020, the TSC U.S. Water Risk Index outperformed the benchmark S&P 500 Index by 2.5% per year while having an average 55% lower Water Footprint than the S&P 500. The TSC Eurozone Water Risk Index® outperformed the benchmark Euro STOXX 50 by 0.11% per year while having an average 62% lower Water Footprint than its benchmark.
“At last, investors can now significantly reduce their exposure to portfolio water risk without having to sacrifice performance,” said Barth.
“The world needs investment solutions that reward investors while encouraging good corporate water stewardship for a sustainable future,” Schumann said. “I collaborated with Anatase LTD to design and launch the world’s first benchmark index suite that maps water risk in equities and eventually across all asset classes and the first index family that meaningfully reduces the water footprint of investment portfolios.”
About Thomas Schumann Capital®
Thomas Schumann Capital® (www.thomasschumanncapital.com) is the leading solution provider at the nexus of water security and responsible investing. TSC is delighted to sponsor the TSC Water Risk Indices®, the world’s first index series that delivers performance while advancing UN Sustainable Development Goal 6. TSC’s solutions help capital markets to integrate physical and financial water risk into investment decisions in order to achieve long-term sustainable performance, positive impact, water stewardship and engagement.
About Anatase Ltd
Anatase Ltd (www.anataseltd.com) is an independent consulting company founded in 2019 by Markus Barth, CFA. A seasoned investment professional and index pioneer, Markus has designed, developed and launched many highly successful proprietary indices throughout his 30+ year career in the financial services industry. Anatase provides extensive expertise in index development, structured products and investment solutions while coordinating the wrapping of indices into various investment products that can be accessed on a global basis.