Despite attracting little in the way of investor interest in terms of trading volume and net assets, the iPath Global Carbon ETN (GRN) has outpaced the S&P 500 Index, U.S. Oil Fund (USO), U.S. Natural Gas Fund (UNG), and Central Appalachian Coal Futures (QL) (down 28.5%) over the past three months. Since diverging from oil and natural gas in late July, the global price of carbon is still trading above its low point at that time despite a global unwind of leverage which has hit commodities especially hard.
During recent market turmoil and a meltdown in commodities, the Global Carbon ETN (GRN) (-10%) has held up much better than oil (USO) (-35%) and natural gas (UNG) (-45%) and about the same as the overall market S&P 500 ETF (SPY), with the approximate three month returns listed after each ticker.
Key factors in the demand for carbon credits include overall power demand and the relationship between natural gas and coal prices since burning gas results in the release of less than half of the greenhouse emissions versus coal. C
Late last week, Climate Exchange (London: CLE) posted strong operating results , stemming a massive loss in market value of about 50% (from about 2,000 to 1,000 pence per share) in the wake of the financial crisis and near market meltdown. The stock has since settled at the 1,300 level as carbon trading growth in the Company's two climate exchanges (European – ECX + Chicago – CCX) demonstrated health growth during the first half of 2008. The ECX posted gains from the year-ago period of 150% on over 1 billion tons wh
During recent market turmoil and a meltdown in commodities , the Global Carbon ETN (GRN) has held up better than oil (USO) and natural gas (UNG), but fared slightly worse than the overall market as illustrated in the accompanying three-month chart. Key factors in the demand for carbon credits include overall power demand and the relationship between natural gas and coal prices since burning gas results in the release of less than half of the greenhouse emissions versus coal. Currently, the simplest way for power utilities
Camco ( London: CAO ) announced a successful auction of 5.8 million [M] tons of carbon credit certificates yesterday, netting a better than expected $15M euros or $22M USD. The Company has gained over 11% in the last five trading days and over 46% in the last month, resulting in a market cap of about $185M USD. Another mover in the Global Carbon Trading Index this past week is Clean Energy Fuels (CLNE), which recently acquired Dallas Clean Energy, LLC, from Camco in a $19.1M cash deal. As part of the sal
The accompanying three month chart comparison illustrates that carbon prices, as tracked by iPath Global Carbon (GRN), have continued to diverge and outperform both oil (USO) and natural gas (UNG) as reported in my original article two weeks ago. In addition, the Central Appalachian Coal Futures near-month contract ( NYMEX: QL ) is up 11.8% over the last three months. Key factors in the demand for carbon credits include overall power demand and the relationship between natural gas and coal prices since burning ga
As featured in my CNX Gas (CXG) story is the Company’s capture of coalbed methane gas, which is eligible for carbon credits on the Chicago Climate Exchange. CNX Gas is the second-largest play on methane gas capture in the US behind Waste Management (WMI). As the only oil and gas company registered as an offset provider with the Chicago Climate Exchange, CNX Gas has already registered 8.4 million tons of carbon credits and expects future capacity to generate 2 – 3 million tons annually. As I have recently featured , these credits have commenced trading with a most recent ...
The exchange-based trading of carbon allowances in the US is underway over four months ahead of the official start of the Regional Greenhouse Gas Initiative [RGGI], which covers 10 states in the Northeast and Mid-Atlantic that have pledged to reduce 2010 greenhouse gas emissions to 10% below their 1990 levels. The RGGI states have put in place a regional cap-and-trade system to regulate CO2 emissions from power plants and the program is slated to officially begin on January 1, 2009. The Chicago Climate Futures Exc
The accompanying table presents an updated version of my Global Carbon Trading Index, which now includes 18 components with a one month return of -6%. I have included the iPath Global Carbon ETN (GRN) as an active component and added the Market Vectors Environmental Services ETF (EVX) as a benchmark tracking fund. The index has been volatile over the last five days, with several component stocks involved in carbon credit generation and trading recording gains exceeding 20% and losses over 10%.
The accompanying table illustrates the high stock price volatility experienced by my Global Carbon Trading Index over the past five days. The following three stocks experienced gains exceeding 20% in just the last five days, including: EcoloCap Solutions (OTCBB: ECOS), Global Green Solutions (OTCBB: GGRN), and Carbon Conscious (Australia: CCF). Overall, the 17-stock index experienced an average gain of 2.4% on an equally-weighted basis over the past five days versus an increase of 1%
Investors who are interested in the emerging industry for the generation and trading of carbon credits [a web link to my blog posts on carbon credits] may find the following strategy useful for to invest in my Global Carbon Trading Index . Please keep in mind that this strategy should only be implemented for the speculative portion of one's portfolio and is geared toward US-based investors in terms of liquidity and ease of trading access. While E*TRADE offers investors the opportunity to invest in foreign
The accompanying table presents the MikeHav Global Carbon Trading Stock Index along with tracking of related commodities and benchmark funds -- including coal prices, iPath Global Carbon ETN (GRN), US Natural Gas Fund (UNG), US Oil Fund (USO), and Market Vectors Global Alternative Energy ETF (GEX). Key factors in the demand for carbon credits include overall power demand and the relationship between natural gas and coal prices since burning gas results in the release of less than half of the greenhouse gas emissions versus coal. Currently, the simplest way for power utili
As an alternative to the pure-play carbon credit generation and trading companies such as Camco (London: CAO), EcoloCap Solutions (OTCBB: ECOS), and EcoSecurities Group (London: ECO), investors who are bullish on the future of carbon credit trading might also consider an investment in UK-based Climate Exchange (London: CLE). The accompanying charts highlight the six-month performance of Climate Exchange, the US Oil Fund ETF (USO), Camco, and the S&P 500 Index. Below
The accompanying chart compares the returns of exchange-traded funds [ETFs] representing a variety of commodities and stock indexes. The top performer in this group was the iShares Russell 2000 Small-Cap ETF (IWM), followed by the Healthcare SPDR (XLV) and US Dollar Index Bullish (UUP) which all had positive returns during the last three months. Thanks to a recent rally , the iPath Global Carbon ETN (GRN) cut some of its losses and moved ahead of the two laggards in this group – the SPDR Gold Trust (GLD) and the US Oil Fund (USO). Some other useful ETF benchmarks (listed f
Carbon prices are rebounding and diverging from an overall decline in commodities and oil on Tuesday as London-based Camco International ( London: CAO ) recorded a $2.6 million (US Dollar) profit on the sale of 151,288 tons of carbon credits on the spot market. The CERs were sold to an undisclosed buyer outside of the European Union for an average price of just over 19 euros per ton versus an average acquisition price of just 7.5 euros per ton. With Certified Emissions Reductions ( CERs ) currently trading around 19.75 euros per ton on Tuesday, Camco's portfolio of carbon
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