In the cutthroat world of finance, timing is everything. For Ian Simm, CEO of Impax Asset Management, seizing the moment meant correcting a past mistake and capitalizing on a rare opportunity. As Nvidia’s stock plummeted earlier this year, Simm saw a chance to right a wrong and snag a piece of the tech giant’s explosive growth.
Simm’s London-based firm, founded in 1998, has built a reputation as a champion of sustainable investing. But even the most well-intentioned strategies can falter. Impax had long regretted not getting in on Nvidia’s ground floor, missing out on an astonishing 800% rally since 2023. The reason? Nvidia’s sky-high valuation made it seem like a pricey bet.
That was until the market corrected itself, and Nvidia’s share price took a nosedive. With a peak-to-trough decline of nearly $1 trillion, Simm saw his chance. He believes the company’s current $3.2 trillion valuation still understates its true worth.
As Impax looks to rebound from a tough couple of years, Simm is shifting focus towards undervalued Big Tech opportunities. The firm’s share price has taken a 30% hit this year, while the S&P Global Clean Energy Index has lost over 10%. But Simm remains bullish, citing Nvidia’s potential to drive demand for its chips as artificial intelligence continues to boom.
What’s more, Simm argues that holding Nvidia makes sense from a climate perspective. As energy demands continue to rise, companies like Nvidia that develop more efficient models will be better for the environment. Nvidia’s Blackwell chips, for example, would require a fraction of the power needed to develop OpenAI’s GPT-4 software compared to just a decade ago.
Impax now holds Nvidia in five strategies and funds, including its Global Opportunities portfolio, which targets companies with diversified business models operating in high-growth markets. Microsoft Corp. is another undervalued gem, Simm believes, thanks to its role in the secular trend towards AI.
As the US economy looks set for a soft landing, Simm sees confidence returning and the cost of capital falling. It’s an attractive time to be in equities, and Impax is poised to capitalize on the trend. By learning from past mistakes and adapting to the market, Simm is betting that his firm can not only make money for its clients but also drive positive change in the process.
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