Greenfield

An infrastructure asset still to be built. It carries construction, cost-overrun and demand risks that fall away once it is running, so it is expected to earn more than brownfield.

Where you will meet it

Greenfield appears in 3 learning outcomes on the CFA syllabus. A few of them:

• Explain the defining features of infrastructure investments
  CFA Level I · Alternative Investments

  “Brownfield assets are already operating and carry lower risk than greenfield projects still to be built, where construction and demand risk dominate.”

• Explain the key characteristics of infrastructure as an investment
  CFA Level III · Private Markets Pathway

  “Revenue can be regulated, contracted or demand-based, as with tolls, and assets are either greenfield (to be built) or brownfield (already operating).”

• Weigh risk and return across infrastructure strategies and relative to other assets within a strategic allocation
  CFA Level III · Private Markets Pathway

  “Core-plus, value-added and opportunistic strategies add greenfield construction, merchant or demand exposure and emerging-market risk, raising both expected return and dispersion.”

See also

Brownfield

Practise it

• Today's practice question One question, with every wrong option explained.
• Free Level I diagnostic test Twelve questions that show which topics to start with.
• Free finance calculators Check your arithmetic on the exam's core formulas.

All terms beginning with G · Glossary