When discussing “ Green Investing ”, it is important to ask the question what constitutes “green”. Obvious examples of green investments might include renewable energy (solar power, wind power, etc.) or waste management and reduction technologies. A less obvious example might be railways. Railways could be considered "green" because they are one of the most energy efficient methods of transporting goods.
The purpose of this section is to provide readers with a cursory overview and discuss some general themes relating to green investments. The information provided here should not be considered professional investment advice. Always consult with a professional advisor before making any investment decisions.
Here are some examples of well established green investing themes:
- Renewable power/power generation
- Hydro electric power
- Tidal power
- Geothermal power
- Waste recycling
- Waster water management
- Energy recovery
- Smart grid
- Power management
- Invest in the key elements required for green technologies- examples might include mining companies that extract gallium, indium, and germanium... key components in the production of solar panel cells
- Energy storage
- Emissions trading
Here are some ideas to help you get started with your investments.
Green Stock Exchange Indices
Most major stock exchanges have at least one index that have is focused on the “environmental movement”. Investigating these stock indices is a great source for industries leading companies that could form part of your green investing strategy.
Green Mutual Funds
There are a large number of green mutual funds in the marketplace which are a convenient way for the average investor to invest in the green sector. Green mutual funds could have investments in a number of green industries or it could be focused exclusively on one industry sector such as renewable energy or water. A true green mutual fund should employ socially responsible investment principles.
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There are a number of Exchange Traded Funds (ETFs) that have a “green” focus to them available to investors. Green ETFs can give investors exposure to green investing themes in a cost efficient manner while offering broader diversification than investing in a single company. Some green ETFs focus on specific subsectors (renewable energy for example) while some ETFs will offer a number of “green” subsectors in one fund.
This information should not be construed as professional investment advice. Readers should do their own due diligence and speak with your investment advisor before making any investment decisions.
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