The world has never been a better mix of sunshine and hurricane as it is today. Amongst an abyss of disappointing news from all over the world, be it natural disasters or geopolitical tensions, there is something which will make the former generation proud and the later thankful. It comes in the form of sustainable investments!
In case you’re planning on jumping off the wagon and closing this tab, DON’T!
Read on a bit. I can assure you there’s a feel-good factor at the end.
Sustainable investment is the eventual reflection of how we ‘millennials’ live life, on the stock market. Having grown up doing presentations about global warming and carbon footprints, our psychological setup attracts us to concepts which are environment-friendly or associating with brands which foster ethics despite their price tags.
On the cusp of redefining consumption and propagating value led spending, we are unconsciously bringing about a new change. Green and clean technologies are getting an unprecedented inflow of interest and popularity. Investments in such business have been significant and in a recent survey by EY, it is said that millennial investors are twice more likely to put their bets on these companies.
On a wider platform, bringing alternative resources, such as Lithium, onto the main current is driving markets towards a fresh restructuring. Crude/ petroleum products, a.k.a. carbon footprint’s ink, are losing interest amongst the newbies, who ready to take charge of the wheels. Such is the connotation of the environment we were raised in – a more responsible approach even when investing. Keep a watch out for the Lithium stocks. It’s a no-brainer that this natural resource is set to create headlines in the coming days.
Now that we have touched base upon Lithium, how can we not mention the 21st-century messiah of sustainable life? Yes, I am talking about Elon Musk and of course, Tesla. Every person in our generation trusts Tesla because of its vision. Applying sustainability to the mainstream industries, from automobiles to space travel, we can see how he and his organization have brought about a confluence of investments and social consciousness.
There was also a study by Morgan Stanley in 2015, which claimed that by 2025 there will be around $30 trillion inherited by North American millennials who are just waiting to transform the world in some way or the other. Even the Royal Bank of Canada published a study which showed that the wealthy millennials have a huge appetite for impact investing.
On our platform (link) we provide you not one but two socially responsible ETFs – iShares MSCI KLD 400 Social ETF and iShares MSCI USA ESG Select ETF. The former lists 400 companies that are contributing towards social and environmental conditions. They exclude those which deal in tobacco, alcohol, weaponry, nuclear energy or genetically modified tools and guess what; Apple, Exxon Mobil and AT&T are specifically not listed because of their low EGS rating. The latter tracks 250 companies, mostly mid-cap, with highest EGS ratings, weigh them in proportionality to their EGS rank and invest in around a 100 of them.