Can greener investments in your portfolio mean more green in your account balance? More people than ever are realising that we cannot afford not to invest in the future of our planet. What began as a grassroots movement in the 1970s now has governments worldwide heeding this call, enacting concrete measures to promote environmental, social and governance issues (ESG), proving that “greener living” is here to stay and not a passing trend.
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What is Earth Day?
The very first Earth Day took place in the US on April 22, 1970, marking the birth of the modern environmental (or “green”) movement. American industry was at an all-time high, yet, awareness of the price that humanity might be paying in ecological damage was largely nonexistent. Earth Day was created to raise public awareness and concern for the environment, especially the link between air pollution and public health. In 1990, celebration of Earth Day went global and today includes events coordinating over one billion volunteers in more than 190 countries worldwide.
What is sustainable investing?
More and more, individuals are feeling a greater social responsibility and a desire to protect our planet’s resources for the good of mankind. They are choosing to put their money where their beliefs and values are, investing in companies that combat pollution, climate change and environmental destruction, produce sustainable products and services, and promote ethical business practices. These investments make long-term financial sense as well, especially with government policies such as the 2015 Paris Agreement moving towards stricter global regulation of industries on environmental issues.
Top earth-friendly trends in 2021
- Solar energy: Using energy from the sun is not new, but newer technology and reduced manufacturing costs are finally making solar energy a possibility for the mainstream and for generating electricity on a massive scale.
Solar energy stocks: SolarEdge Technologies, Xinyi Solar Holdings, First Solar, Canadian Solar
- Wind power: Another replenishable natural resource that exists in abundance is wind. The use of windmills for energy predates the invention of electricity. With the development of new technologies, the modern global wind energy market is projected to grow to nearly $100 billion by 2025.
Wind power stocks: Vestas Wind Systems A/S, Orsted A/S, NextEra Energy
- Electric cars: Transportation run on fossil fuel is the primary cause of carbon gas emissions contributing to climate change. Electric hybrid cars are already a reality and the automotive industry, including traditional carmakers such as GM, is gradually shifting towards completely electric vehicles, presenting a variety of new investment opportunities. For example, by the end of 2020, Tesla’s market cap was larger than almost all of the traditional car manufacturers combined ($669 billion versus $654 billion. Source: Bloomberg).
Electric car stocks: Tesla, Nikola, Nio, Plug Power, General Motors, Volkswagen, Ford
How can you get started with sustainable investing?
In addition to the stocks listed above, eToro also offers ready-made diversified investment products suitable for sustainable investing. These include:
- The Invesco Solar ETF: This exchange-traded fund is based on the MAC Global Solar Energy Index and composed of leading companies in the solar energy industry.
- The RenewableEnergy Smart Portfolio: This portfolio provides diversified exposure to companies developing sustainable energy solutions for residential and commercial use, including solar energy, wind power, hydropower, recycling and waste management, electrical infrastructure, and clean transportation.
- The DriverLess Smart Portfolio: This portfolio provides diversified exposure to stocks from leading automotive companies, high-tech companies and software developers involved in evolving transportation for the future.
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Source:
https://content.etoro.com/lp/pdf/RenewableEnergy_report_EN.pdf