The Derivative

Emissions Trading and Carbon Allowance Futures with Michael Azlen


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We're taking a trip across the pond to London in this episode and diving into the carbon markets and emissions trading with Michael Azlen, CEO and founder of Carbon Cap Fund and Management. Whether you care about making money off trending carbon emission prices, or saving the planet,  or both… Mike has become a leading voice for educating and explaining the role carbon emission credits and the emerging carbon futures markets play.

In this episode, Mike breaks down the complex carbon concepts and answers some critical questions, like how do you trade carbon credits? What is an emissions trading system? Why is Europe the big player in this game? And he even gives us his hottest take in the market right now — we'll give you a slight hint, it involves climate change.

Highlights from this week's episode include:

  • The evolution of the U.S. and European Carbon Market
  • Identifying and clarifying the difference between the voluntary carbon market and the compliance or regulated carbon markets (where Carbon Cap invests)
  • How to think about a market that is structurally designed to increase in price
  • Understanding how this market functions as a policy tool
  • A closer look into Europe's carbon border adjustment mechanism
  • And, how a hedge fund can make money and save the planet simultaneously —  you'll want to tune in for these details and more!
  • Chapters

    00:00-02:00 = Intro

    02:01-12:38 = Wait? You can trade Emissions? What are Carbon Markets?

    12:39-30:40 = Excess units vs Purchase units, Lowering Emissions, & Counter Party Risks

    30:41-50:50 = Carbon Cap Mgmt and the Carbon Cap Fund

    50:51-01:08:40 = Can we really Capture It? Climate Change, Natural Cycles & C02 levels

    01:08:41-01:14:11 = Hottest Take

    More from this Episode:

    View World Carbon Fund - Generating Absolute Returns from Global Carbon Markets

    Visit Carbon Cap Management's website 

    Follow along with Michael Azlen on Twitter


    Don't forget to subscribe to The Derivative, and follow us on Twitter at @rcmAlts and our host Jeff at @AttainCap2, or LinkedIn , and Facebook, and sign-up for our blog digest.

    And visit our sponsor, the CME Group at www.cmegroup.com to learn more about futures and options.

    Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

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