“We have this energy boom and they have this new need for supply,” says Greywitt. The Chinese government knows it must change how it sources energy to reduce pollution and, in turn, improve social stability, he says. He also notes that China’s demand for liquid natural gas has risen in the aftermath of the 2011 Fukushima nuclear disaster in Japan.

“Because of the abundance of natural gas in the U.S. and the big price difference,” says Patel, “there will be opportunities for natural gas to be exported and Asia will be a big part of that.” Although liquid natural gas is not yet being exported, U.S. facilities are already being built in anticipation of this.

One company whose shares are held in the Deutsche Global Infrastructure Fund is Cheniere Energy, a Houston-based energy company primarily engaged in liquid natural gas-related businesses. It was the first company to receive approval to export liquid natural gas, says Patel.

The co-managers are also interested in companies that own natural gas pipelines in overseas markets expected to increasingly use this fuel when more of it is exported from the U.S. and elsewhere. “There’s a pretty long runway, so we think there are lots of opportunities for these companies,” says Greywitt.

He and Patel also note that much is happening in Mexico with energy and transportation. The government there has made infrastructure a priority in order to benefit the economy. The regulatory environment has been fairly consistent and energy reforms have been enacted since the current Mexican president took office in December 2012. There are opportunities for private capital to come in, they say. One Mexico-based holding in their fund is energy-focused IEnova, a large builder and operator of pipelines.

No matter the region or sector, the co-managers seek to invest in companies whose rates of return exceed their cost of capital. “Those are the companies that can consistently create shareholder value,” says Patel.

Core Pure Plays
The Russell Global Infrastructure Fund (RGISX), a U.S. mutual fund featuring listed equities, uses a multi-manager approach to achieve balanced risk profiles. The fund’s portfolio manager, Seattle-based Adam Babson, actively manages the fund by hiring and firing managers and adjusting manager weights. The fund holds more than $3.2 billion in listed infrastructure investments.