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Thinking Green, Investing Green

Lesley Scorgie

Posted Jul. 10, 2008
Tagged: Money, Investment, MoneyTips

Hi Everyone,

In my last post I focused on ethical investing. To enhance that initial piece, I thought it would be interesting to look into ‘Green’ investing. ‘Green’ investing focuses specifically on environmental protection.

In recent years, heavy focus on alternate energy sources has dominated many investor discussions around the globe. In fact, the American Stock Exchange now has an entire index, the Cleantech Index (CTIUS), dedicated to 76 companies that are global leaders in clean technology. As alternative energy gains popularity and attention, the thought is that unique and profitable investment opportunities will surface.

According to some experts, people invest in alternate energy for some of the following reasons:

Reverse the effects of Global Warming
To prepare for increasing oil costs and/or running out of oil period
To improve local economies through Energy Security
To make money

If you’re keen to invest in the alternate energy market, you have an opportunity to purchase stocks, mutual funds or exchange traded funds (ETFs). If you’re interested in stocks, tread with caution and do ample research as this sector isn’t well covered by analyst research. Additionally, many companies lack lengthy company histories which are helpful in determining future direction.

Professionally managed mutual funds are an alternative to individual stock purchases. For a management fee, often quite large, one can buy into mutual funds. Two mutual fund examples are Guinness Atkinson Alternative Energy Fund (GAAEX) or New Alternatives Fund (NALFX).

If you’re not interested in paying to have your money managed by an advisor, you can buy into ETF’s which are managed by a computer under the guidance of a professional. Fees are generally a fraction of what a mutual fund fee would be. Two ETF examples are Market Vectors Global Alternative Energy ETF (GEX) and Powershares Global Clean Energy Portfolio (PBD).

Many companies and funds focused on renewable energy have gained significant market share and stock price momentum in recent years. Whatever you decide to add to your portfolio, green or not, ensure it fits with your long term goals and risk tolerance.

All the best,
Lesley Scorgie

Lesley Scorgie is the bestselling author of Rich by Thirty: A Young Adult’s Guide To Financial Success published in January 2007 and printed in English, French and Korean. Lesley owns and operates Rich By Inc., a financial consulting company dedicated to providing education, resources and tools for a variety of demographics. Lesley’s passion is to encourage financial literacy, a topic she has enthusiastically promoted through speaking and writing since 2001.

She has made numerous television appearances including The Oprah Winfrey Show and Montel Williams, and her financial writing has appeared in publications such as Unlimited magazine, the Calgary Herald and the Calgary Sun. Lesley has worked in the banking and securities industries and as a spokesperson for Canada Savings Bonds.

In 2005, Lesley Scorgie graduated from the University of Alberta with a Bachelor of Commerce degree in marketing and finance. She currently works diligently to promote financial literacy through speaking, educating and writing. In addition to this Lesley dedicates substantial time, energy and resources to non-profits within her community. See Lesley Scorgie's other posts and profile.

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