Monday, November 18, 2013

The Vilification of the Green Market - The Experiment

This is part 1 of an ongoing series covering an experiment I have done for the past year in building a sustainable portfolio and the lessons learned as a result. 

The Experiment

For the past year I have been running an experiment. It is an attempt to build a real green portfolio, one where one could find Solar and sustainable tech. Off of my meager funds, I attempted to create such a fund that would actually make money. I wasn't investing heavily, honestly I didn't have much to invest so my experiment couldn't be pricey.

My stepfather and father are both intimately familiar with the workings of the stock market, one of my uncles works on the building, selling and saving of businesses and another uncle who made six figures at 45. I have spoken with each of them in-depth about my goal and each had a different opinion. After thinking about it for far too long, a particularly interesting holiday family gathering conversation made me take the plunge and I bought my first piece of stock.

I had made myself a couple of rules:

Only invest in companies that you think would build a better future. 
This concept is fairly straight forward for the humanitarian but a little contrary to most investment strategies on the stock market. The floor cares about profits, growth and value. As I have learned from really concentrating on the stock market for the past year, those that decide the price and affect the price are very quick to judge and jump to wild conclusions.

Try to think in the long term. 
Many market strategies for investment go from quarter to quarter or sooner. I wanted to avoid that so I decided to try and find companies that followed my first rule but would not only make a profit but possibly become pivotal to the economy of the future.

This can have many definitions. To me it includes markets such as solar, geothermal, wind and ocean in the energy production sector and companies that solved energy storage problems.

Research the market. 
From watching the Daily Show and reading Blogs, I decided to avoid any and all financial advisers and researched the market with my own intuition. Once learning as much as I could about the company, its customers and the market, I would make a rational decision to buy or watch it.

Right around my birthday in November, I had heard about this company on NPR who had an interesting business model for Solar panelling. I found Solar City so interesting that not only did my research set me off on my appreciation of Elon Musk.

This led me a few months later, at the encouragement of a dear friend of mine, to purchase Tesla (TSLA) since it was on the rise and in the news at the time. I started picking up a few shares over the next months till I had a Bio-Med company doing cancer research, a fuel-cell producer and supplier, a green energy REIT and a few others.

As of this morning, my portfolio has gone up by 119.47%. Of all of my investments, only one has a negative movement worth a total of $6.20.

I know that this was unusual, and based on a lot of luck in my access to information but it opens the concept of making money by buying the stocks of the companies you want to be around in the future and either selling or not purchasing those that may rise in price, but have a net loss to society. I see oil and coal based companies in this queue unless they make a serious lateral movement into serious green production and an almost total abandonment of business as usual. The future of our economy and our relationship to it needs to be realigned to be more efficient and more sustainable.

To extend the experiment I also put together a fake portfolio of stocks that grab my eye who do work in the Green space. Through out this series I will be posting updates to that list and eventually having a link that all can view.

This experiment and what I have learned in the process reinforced my belief that there is an alternative to how we are currently running things. Through out the past year of paying closer attention to the stock market and the news surrounding it, I have also learned some very interesting things. Including the fact that pretty much no one who is writing about the market, knows what they are talking about.

But more on that in part 2.

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