News / Media

Carbon Price Boom Attracts Investors to Emissions-Trading Market

WSJ — Investors have piled into new carbon-credit-trading funds, helping make the upstart market one of the best-performing commodities-related investments of the past year.

The price of carbon credits traded in Europe has jumped 135% over the past 12 months and recently hit a series of records as economic activity rebounded from pandemic lockdowns. Only lumber, driven higher by the housing boom, has proved a better commodities investment.

Tighter government controls, a bitter European winter and low inventories of liquefied natural gas—which required the need to burn more carbon-intensive coal—also played a role.

The soaring market has attracted investor cash from a collection of nascent carbon-only investment funds that seek to profit as economies transition away from fossil fuels. KraneShares Global Carbon ETF, launched in July 2020, has quickly attracted close to $400 million in investor money, most of those inflows this year. It trades under the ticker symbol KRBN.

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For KRBN standard performance and top 10 holdings please click here. Past performance is no guarantee of future results. Diversification does not protect against market risk.