Growing green bonds could help the environment

As part of a series of features ahead of the General Election 2019, Professor Adrian Bell and Henley students were interviewed by BBC South Today's business editors Alistair Fee. Filming took place in one of the dealing rooms at the ICMA Centre, with students engaging in a stock market simulation in line with the series theme of 'What the markets say'.

Fidelity, the asset manager with $2.4 trillion assets under management, recently announced the launch of two index mutual funds with a 0% fee! This announcement is interesting for several reasons. First, the asset management industry has been involved in an intense price war and this new fee level of 0% represents a very tough benchmark for the competition to beat. Not surprisingly, the share price of rival asset managers fell by a few percentage points shortly after the announcement. Second, the new fee level is unusual as it indicates that, for the first time, investors could get exposure to both US and international equities without incurring any fee. This is a curious business decision. How will Fidelity manage to pay for all its expenses? Will this product be a loss-making venture? Is there more to it than meets the eyes?