When it comes to green investing, where do you start if you are new at it? If you are not a risk taker at heart then you should steer clear of individual stocks but should instead consider a combination of mutual funds and exchange traded funds (ETFs). This is an excellent way to start green investing that can bring in some money for you too.
Steps to Successful Green Investing
1. You can choose your own sustainable and green investments but you can also hire a financial adviser. Stay away from brokerage houses or one of the bigger firms. Instead find someone who is online or local and who is experienced, trustworthy and comes highly qualified when it comes to green investing.
2. Green investing works best when it is a long-term investment (a minimum of five years). Bear in mind that any investment, green or otherwise, involves a risk. Decided what percentage of your portfolio you wish to use towards green investing. Will it be 5 percent, 10 percent, 15 percent or 20 percent? Spreading your risk among more than one form of sustainable investment is the most responsible choice for anyone to make.
3. Start out with the tried and true in terms of green investing. There are some companies that are well established and have been around for many years. Choose companies that have a long standing commitment to green investing. Some excellent choices include New Alternative Funds, Domini Social Equity and Winslow Green Growth.
4. Be aware that although green investing has been around for many years it is still a relatively new form of investing. It is the wave of future investing but it needs time to catch on and grow. For example, the future will see such things as green corporate bonds and green real estate investments and the like. For now be as conservative as possible in terms of green investing and when it comes to adding income to your portfolio. Two places to look for SRI that you can feel good about include Domini Social Bond Fund and Pax World High Yield.
5. Design your portfolio in such a way that you diversify. For example choose three to five green investments that do not overlap one another (or only overlap slightly). Some examples of green investments that would not cause problems with overlap include green energy, water, socially responsible and Cleantech.