Da Vinci Invest of Zurich, Switzerland is launching its environmental and shariah-compliant Green Falcon Fund. In addition to its flagship Volatility Arbitrage Fund, this new vehicle will invest in the carbon markets and forestry. The carbon markets are steadily growing, and they are characterized by recurring inefficiencies, enabling a range of arbitrage strategies, according to the firm, in a press release.
The fund will comply with Islamic law on trading and work closely with local advisors to set up halal (permissible) and haram (forbidden) trading strategies. This also means that it is its aim to avoid bayu al gharar (trading with excessive risk), and it will concentrate on the more vanilla structures and strategies. It will actively trade the carbon markets on a short-term basis and invest in forestry for the long haul. This will provide an attractive investment with consistent value growth, diversification and an environmental benefit, said the firm. Its advisors, Rainforest Invest, Forest Finance and Miller Forest will source opportunities in Panama, Costa Rica and Paraguay, which it says are politically stable countries that have optimal growing conditions. Only land that was formerly used for agricultural purposes will be planted. No rainforest will be cut to put up plantations. The Da Vinci Green Falcon Fund will charge a 2% management fee and a 20% incentive fee.