Invest in clean energy
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Summary
Investing in renewable energy helps combat climate change and speed up progress. You can invest in renewable energy stocks or exchange-traded funds to support the transition to a cleaner future and potentially earn a good return on the investment.
Description
Did you know you can combat climate change by investing in clean energy like solar, wind, and geothermal? Green energy companies and the industry must continue innovating to out-compete fossil fuels. Renewable power needs financing to reach all facets of society.
If you are in a good position financially, you can invest in various aspects of the renewable energy supply chain and ecosystem. For example, you can invest directly in public companies like First Solar (FSLR), a large-scale solar panel provider. Alternatively, you can invest in other renewable stocks like Sono Motors (SEV), which makes solar-powered cars, or Siemens Gamesa (GCTAY), which manufactures wind turbines across the world.
A less risky approach is to invest more broadly in a basket of green energy stocks through exchange-traded funds (ETFs) like iShares Global Clean Energy.
It is an excellent way to put your money to work to speed up the transition to a cleaner and more resilient future. In turn, there may be a good return on your investment, which can then be used to further finance companies that need funds for growth and innovation.
If you are in a good position financially, you can invest in various aspects of the renewable energy supply chain and ecosystem. For example, you can invest directly in public companies like First Solar (FSLR), a large-scale solar panel provider. Alternatively, you can invest in other renewable stocks like Sono Motors (SEV), which makes solar-powered cars, or Siemens Gamesa (GCTAY), which manufactures wind turbines across the world.
A less risky approach is to invest more broadly in a basket of green energy stocks through exchange-traded funds (ETFs) like iShares Global Clean Energy.
It is an excellent way to put your money to work to speed up the transition to a cleaner and more resilient future. In turn, there may be a good return on your investment, which can then be used to further finance companies that need funds for growth and innovation.
Tips
• First, do some research. Key things to consider are your risk tolerance and your investment horizon. If you are not sure about how to even consider that, then talk with family, friends, or advisors who are knowledgeable. Empower yourself!
• When weighing which company to choose, look at factors that drive a company's success. Does that pick provide you with the best value, strong growth, and momentum? Is it a truly green company that is making a positive impact and has the potential to grow?
• As a starting point, you can get a snapshot of the top renewable energy funds by checking out Nerd Wallet Renewable ETFs and Clean Energy ETFs.
• In addition, here are some of the largest clean energy funds you can consider adding to your portfolio. These may not all be available depending on the platform you use to invest, but they should give you a sense of what is possible so you can look for similar options.
- iShares Global Clean Energy ETF (ICLN)
- First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN)
- Lyxor Net Zero 2050 S&P Eurozone Climate PAB (DR) UCITS ETF
- Amundi Index MSCI Global Climate Change UCITS ETF DR EUR (C)
- BNP Paribas Easy Low Carbon 100 Europe UCITS ETF
- Invesco Solar ETF (TAN)
- Invesco WilderHill Clean Energy ETF (PBW)
- Invesco MSCI Sustainable Future ETF (ERTH)
- SPDR S&P Kensho Clean Power ETF (CNRG)
• It is critically important to consider the expense ratio of any fund you invest in. This is how much money the fund manager takes annually to manage the fund. Anything above 0.50% is extremely high and will cost you a tidy fortune over the years.
• Most importantly, know that your funds power the climate finance movement. These resources allow societies and economies to get ahead of the adverse effects of climate change.
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NOTE: This information should not be relied upon as research, investment advice, or a recommendation regarding any products. This material is strictly for educational or informational purposes and is subject to change.
• When weighing which company to choose, look at factors that drive a company's success. Does that pick provide you with the best value, strong growth, and momentum? Is it a truly green company that is making a positive impact and has the potential to grow?
• As a starting point, you can get a snapshot of the top renewable energy funds by checking out Nerd Wallet Renewable ETFs and Clean Energy ETFs.
• In addition, here are some of the largest clean energy funds you can consider adding to your portfolio. These may not all be available depending on the platform you use to invest, but they should give you a sense of what is possible so you can look for similar options.
- iShares Global Clean Energy ETF (ICLN)
- First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN)
- Lyxor Net Zero 2050 S&P Eurozone Climate PAB (DR) UCITS ETF
- Amundi Index MSCI Global Climate Change UCITS ETF DR EUR (C)
- BNP Paribas Easy Low Carbon 100 Europe UCITS ETF
- Invesco Solar ETF (TAN)
- Invesco WilderHill Clean Energy ETF (PBW)
- Invesco MSCI Sustainable Future ETF (ERTH)
- SPDR S&P Kensho Clean Power ETF (CNRG)
• It is critically important to consider the expense ratio of any fund you invest in. This is how much money the fund manager takes annually to manage the fund. Anything above 0.50% is extremely high and will cost you a tidy fortune over the years.
• Most importantly, know that your funds power the climate finance movement. These resources allow societies and economies to get ahead of the adverse effects of climate change.
------
NOTE: This information should not be relied upon as research, investment advice, or a recommendation regarding any products. This material is strictly for educational or informational purposes and is subject to change.
Additional Resources
https://www.nerdwallet.com/article/investing/clean-energy-etfs
https://money.usnews.com/investing/funds/slideshows/clean-energy-etfs-to-buy-now
https://www.justetf.com/en/how-to/invest-in-climate-change.html
https://money.usnews.com/investing/investing-101/articles/solar-energy-investing-pros-and-cons
https://money.usnews.com/investing/funds/slideshows/clean-energy-etfs-to-buy-now
https://www.justetf.com/en/how-to/invest-in-climate-change.html
https://money.usnews.com/investing/investing-101/articles/solar-energy-investing-pros-and-cons
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Photo Credit
Photo by Jeremy Bezanger on Unsplash