The sustainable team at Evelyn Partners have absorbed a water fund into their portfolios, among some other changes in their latest quarterly rebalance. 

They’ve added Regnan Sustainable Water and Waste to their sustainable range, joining Hawksmoor, Canaccord, and EQ as holders of this fund. 

To fund this, they called time on RobecoSAM Smart Materials owing to a preference for a more defensive theme. 

Assistant MPS head Philippa Douglas said water has room to grow further as the global population increases and urbanises, and she said this was an attractive time to initiate a position in the Regnan fund due to the potentially sensitive nature of materials in the current interest rate environment. 

What else have the Evelyn team been up to? 

Across all models, they switched out JPM Global Macro Sustainable for Trium Climate Impact in the alts space, as part of a shift to reduce correlation to equities within their absolute return bucket. 

“Trium Climate Impact is a market neutral hedge fund which invests in mid and large cap climate solutions in its long book and hedges out volatility, factor and style risk in its short book,” said Douglas. 

“The team seeks significantly higher avoided emissions than direct emissions in potential investee companies, as well as contributions to clean water, less waste, the circular economy and improved efficiencies.”

Are water funds a popular pick for sustainable allocators? Somewhat.

We looked into this a bit last year, and we found that Robeco Sustainable Water is held by two DFMs while Natixis Thematics Water, L&G Clean Water, Allianz Global Water and Lyxor MSCI Water ESG Filtered are all held by one.

It's not surprising that in ESG portfolios the most popular thematic funds are ones which invest in the energy transition, with healthcare also popular.

But, to continue our tradition of tragic puns, it’s fair to say that demand for water hasn’t dried up just yet.