| Jordan Kimmel |
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Next year will make the 40th anniversary of Earth Day. Since that time there has been plenty of talk and interest in creating a cleaner and more sustainable environment, but until recently not a lot of action. Over the last 40 years we have seen dramatic growth in the population growth and consumption on every continent- only increasing the need to be thinking about how we can continue to survive and grow, without consuming our very planet. I see the opportunities developing in the investment world opening up for the next several years as we go from “thinking green” to “going green”.
I have been reading white papers with great interest regarding the subject of “impact investing”. This term refers to a new concept of investing that is sure to catch on. Over the last couple of decades we saw the first “socially responsible” funds open up as well as a small move to start the first “green funds”. These were important initial steps and helped to show how much interest there is in “doing well by doing good”. To date the returns on most of these funds have been mostly subpar, but for the most part the investors have remained satisfied because their expectations were in terms of the social responsibilities being meet by the money invested, not just driven by the investment returns.
I think we are now ready for the next steps to be taken in the investment markets in terms of green, social, and impact investing. Following the bear market of late 2007 through early 2009, investors are in a new mind set. The severe breakdown in trust of Wall Street institutions and the markets themselves have lead to investors to demand a better blend of outcomes- more transparency and less of a “me first” investing mentality. This is one of the key reasons green investing, along with the other ‘incentive based” investing will accelerate.
The key to the growth in green investing right now is not the demand for it- but the new supply of opportunities in this area. The new wind, solar, fuel cell, and alternative energy projects demand huge capital investment. For the first time there is actually a place to invest “green”, rather than invest in companies doing their regular business “a little greener”. Starbucks is a great example of a great “socially right” company- but it certainly was not a true “green investment”. Just recently we saw the first billion dollar venture capital fund established strictly to invest in green/alternative energy projects. Currently, I am pointing my Magnet® Stock Selection Process on this sector of the market. My quantitative model ranks public companies based on a proprietary set of ratios and evaluates the value, growth, and momentum aspects of each company. The process is the subject of my recently published book, The Magnet® Method of Investing (Wiley, August, 2009) and is currently available in the major book stores and on-line sources.
Following the publication of my first book in 1998, Magnet Investing, I have made hundreds of appearances on the major financial networks. As I move into the impact investing area I look forward to sharing with you not only the best individual investing opportunities, but look to also share developments in this incredibility satisfying aspect of investing. If you are interested in individual company recommendations, please call me directly as I do share stock ideas publicly, as each client has their own objectives and risk tolerances. I can be reached directly at 212-417-8088. My website will continue to be updated – visit me at www.magnetinvesting.com and let’s get green together.
 Mr. Kimmel is an Investment Advisor with National Asset Management, Inc. ("NAM") and NAM is a registered investment advisor with the Securities and Exchange Commission. NAM provides fundamental investment management services to investors. The views expressed contain certain forward looking statements. NAM believes these forwardlooking statements to be reasonable, although they are forecasts and actual results may be meaningfully different. Actual events may cause adjustments in portfolio management strategies from those currently expected to be employed. This material represents an assessment of the market at a particular time and is not a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding any security in particular. No representation is being made that any investor will or is likely to achieve profits or losses. The performance of the strategy does not reflect the effect of any annual advisory fee. More information about advisory fees is available upon request. As with any investment strategy, there is potential for profit as well as the possibility of loss.
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