By Aniket Bose. Edited by Arjun Chandrasekar.
What Are Green Stocks?
Green stocks are the stocks of companies that typically invest in environmentally friendly energy sources. Some of these stocks are wind power stocks, solar power stocks, geothermal and wave power stocks as well. Green stocks have a lot more conceptual and emotional appeal to the public compared to the other stocks, as they are directly involved with the environment and because the companies provide clean and renewable energy sources. The main downside of green stocks is that it relies heavily on subsidies from the government. This primarily means that when the economy is going through a recession, the cost of conventional energy sources, like oil and natural gas significantly drop.
When is the Right Time to Invest?
Usually, green stocks take a long time to be completely developed as the companies tend to have high starting-up costs and there is no certainty of potential government subsidies. Investors should be very cautious when they are deciding to invest in green stocks according to investing advisors. They suggest investors focus on companies that already have a strong business model and also have long-term growth opportunities. Investors that are very interested in the environment are the most common investors that invest in green stocks like solar power stocks, wind power stocks, and other green stocks. The idea of making money while helping out the environment has a lot of conceptual appeals, however, it should not distract investors from their main financial goals. As an investor, if you do not care whether you lose the money that you invest in a green stock, it is better to just donate that investment to a charity for the environment and be able to write it off on your taxes.
What are the Best High-Performance Green Stocks?
Investors have been anticipating the outbreak of green energy stocks in companies since 2010. Global emissions and fossil fuel usage rates continued to rise during 2010, however with a combination of weather intensity, global policies changing, shifts in consumer benefits, and cheaper clean energy technology; this will result in the 2020s being a turning point for green energy and green energy stocks. The top 5 high-performance green stocks for investors to buy in the United States of America are NextEra Energy (NEE), Enphase Energy (ENPH), SunRun (RUN), Sunnova Energy (NOVA), and Ormat Technologies (ORA).