Hydrogen as an Investment Theme: A Status Assessment

As of the end of March 2026, the portfolio has achieved a +55.31% return over twelve months, with a year-to-date gain of +17.47%. The year 2025 closed with a +32.47% increase.

The Sharpe ratio stands at 2.12, and the correlation with the MSCI World is only 0.38. This highlights the portfolio’s strong diversification benefits and positions it as an independent, alpha-generating asset class.

Below, we outline the broader context and our investment approach.

Europe currently sources a significant portion of its energy from politically unstable regions. Following the near-complete loss of Russian gas supplies, the continent shifted toward LNG imports — from the United States, Qatar, and Norway.

While this diversification reduced concentration risk, it did not eliminate structural dependence. Energy, regardless of its origin, remains a geopolitical instrument. Any region reliant on imports is inherently vulnerable.

The conclusion drawn by policymakers and industry alike is clear: Europe must increasingly produce its own energy.

Renewables can supply electricity, but energy-intensive industries, seasonal storage, and high-temperature processes require an energy carrier that is storable, transportable, and versatile. Hydrogen fulfills this role.

The development of a European hydrogen economy is no longer theoretical — it is underway.

• In December 2025, the network operator Gascade converted a 400 km pipeline from the Baltic coast to Saxony-Anhalt for hydrogen transport — the first operational segment of Germany’s hydrogen core network.
• The network is expected to expand to 9,000 km by 2032, with investments exceeding €27 billion.
• Since early 2026, market participants can reserve binding capacities.

Industrial Transformation

• ThyssenKrupp is building Europe’s largest hydrogen-ready direct reduction plant in Duisburg, supported by €2 billion in public funding.
  • Capacity: 2.5 million tons of DRI
  • Potential CO₂ savings: up to 3.5 million tons annually
  • Gradual transition to full hydrogen operation from 2028
• Salzgitter has already commissioned a 100 MW electrolyzer, producing 9,000 tons of hydrogen per year for its steel operations.

Infrastructure Expansion

• In the Netherlands, Gasunie is developing a national hydrogen backbone to position the country as a hub for Northwestern Europe.
• In Lingen, RWE and BP each plan to build 100 MW electrolyzers by 2027.
• The European Commission has announced a €240 billion infrastructure package for hydrogen networks through 2040, including accelerated approval for 100 hydrogen and electrolyzer projects.

The transition is not without friction:

• Green hydrogen remains expensive
• Infrastructure is developing gradually
• Some industrial projects have adjusted timelines

However, this transitional phase — characterized by investment pressure, regulatory incentives, geopolitical necessity, and technological maturation — is precisely what creates the market dynamics our strategy seeks to capture.

A direct reduction plant is a steel production facility where iron ore is reduced directly to iron without using a blast furnace.

Traditionally, blast furnaces use coke (derived from coal), generating large amounts of CO₂. In direct reduction, a reducing gas replaces coke — historically natural gas, and increasingly hydrogen.

The result is Direct Reduced Iron (DRI), which is then processed into steel using an electric arc furnace.

The key advantage:
When hydrogen is used, the only byproduct is water vapor — not CO₂.

This makes hydrogen-based direct reduction one of the most promising pathways to decarbonize steel production, which currently accounts for 7–8% of global CO₂ emissions.

The Hydrogen Portfolio invests selectively in companies with the strongest price momentum across three core segments:

• Green Hydrogen Production
• Pure Plays
• Solution Providers

The selection follows a strict momentum-based approach, analyzing both absolute and relative momentum. Positions are only held as long as they maintain a confirmed upward trend and are sold systematically when criteria are no longer met.

The transition toward a more independent European energy system is a long-term structural shift.

For investors, the hydrogen sector can serve as a valuable addition — not as a replacement for core holdings, but as an independent return driver with low correlation to broader markets.

We remain available for professional discussions and welcome direct engagement.

• EU Hydrogen Strategy (European Commission)
  → https://energy.ec.europa.eu/topics/eus-energy-system/hydrogen_en
• European Hydrogen Backbone Initiative
  → https://ehb.eu/
• Hydrogen Network Expansion & Projects by GASCADE
  → https://www.gascade.de/en/hydrogen/hydrogen-in-europe