Carbon trading provides opportunity for green hedge fund strategies

Green trading opportunities

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Although carbon trading is still a developing market, hedge fund managers are already exploiting its possibilities. Joanne Harris reports.

 

Carbon trading began as a result of the Kyoto Protocol which came into force in February 2005. It provided the structure for derivatives trading in emissions credits, particularly those related to the emission of carbon dioxide (CO2), the most common greenhouse gas. Hedge fund managers have steadily become one of the largest participants in carbo