Earth Day comes around once a year, but investors can put their money to work to combat climate change year-round.
As more individuals come to terms with the existential threat of climate change, sustainable investing is no longer niche. It's gone mainstream, and it's a growing force in the capital markets.
An often cited 2019 survey from Morgan Stanley found that 85 percent of investors with at least $100,000 in investable assets were interested in sustainable investing.
Some 48 percent of investors with $10,000 or more invested said they were "very or somewhat" interested in sustainable investment funds, according to a 2022 Gallup poll. But only 25 percent said they'd heard "a lot or fair amount" about it, and only 10 percent said they were currently invested in sustainable funds.
Not only is familiarity with sustainable investing low, concepts like ESG can be confusing. ESG refers to "environmental, social, and governance." It's a set of standards used to evaluate companies through a social lens, but a study from Stanford University found ESG ratings can be unreliable because there isn't a standardized criteria for evaluation, information gathering is expensive, and data can be incomplete or unreliable.
Peter Krull, a partner and director of sustainable investing at Prime Capital Investment Advisors company Earth Equity Advisors, echoed those concerns.
"An ESG portfolio that reduces its exposure to ExxonMobil is less bad. One that eliminates it entirely is better. But one that replaces it with First Solar is actually sustainable," Krull told Cheddar News.
Krull recommended sustainable investors eliminate fossil fuel companies or funds that contain them from their portfolios altogether, but other sectors aren't so cut and dried. Mining operations, for example, can mine fossil fuels, but they can also mine minerals for electric vehicle batteries. As for what goes into a green portfolio, Krull recommended alternative energy companies that focus on solar, wind, and geothermal power, as well as less obvious choices like insurance companies that consider climate risk and biotech that improves health outcomes.
"I like to call traditional index investing rearview mirror investing because it's really about investing in where we've been or where the economy has been. Whereas sustainable investing is where the economy is going," Krull said.
Being a smart and sustainable investor can require a great deal of critical thinking and research, and Krull recommended tools like Fossil Free Funds and Invest Your Values to help sort through the noise.
Ultimately, investing is about generating a return. When it comes to sustainable investing, Krull also suggested that investors think long term.
"Because sustainable investing is about investing for the future, [investments are] not always going to be up, especially when value investing is in style," he said. "Over the long term, it should play out. But in short terms, just like we're dealing with right now over the last 12 to 18 months, that value has been in style, you probably will underperform a little bit."
It's no secret tech giant Amazon has a mission of becoming a major player in sports media, and the company is poised to make progress on that goal in 2022. Amazon Prime Video will be the exclusive home to Thursday Night Football for the 2022-23 NFL season. In December, the New York Post reported that Amazon is in the beginning stages of developing studio sports programs, and hopes to soon have a full daily lineup of sports shows. Front Office Sports senior reporter A.J. Perez joined Cheddar News' Closing Bell to discuss.
Digital mental health company Little Otter recently announced it closed a $22 million Series A round. Little Otter was founded in 2020 by a mother-daughter team, which based the company on the idea that a child's mental health can only be addressed by treating the whole family through technology available to everyone. Little Otter CEO and co-founder Rebecca Egger and her mother, Little Otter Chief Medical and Scientific Officer and co-founder Dr. Helen Egger joined Cheddar News' Closing Bell to discuss.
Stocks closed lower Thursday with the tech-heavy Nasdaq in particular under pressure as investors dump tech stocks amid interest rate hike fears. This is the third session in a row that the Nasdaq has slipped. Meanwhile, rate-sensitive stocks gained one day after the Federal Reserve announced its more hawkish policy including three rate hikes this year. Kristina Hooper, Chief Global Market Strategist at Invesco, joins Cheddar News' Closing Bell to discuss today's close, this week's Fed minutes and the central bank's new hawkish policy, and more.
Jared Watkin, senior vice president, diabetes care, at Abbott Laboratories, joined Michelle Castillo from the CES 2022 floor to discuss the future of health tech, including Abbott's consumer-facing biowearable called Lingo. The accessory is supposed to send real-time biomarker information like glucose or ketone levels to the Lingo app for the wearer to review. "The idea is that it's a window into your body," Watkin said. "It gives you insight into what's going on in your body and the certain circumstances that you otherwise wouldn't be able to have."
Aaron Jefferson, VP of product at Luminar, joined Cheddar to discuss partnering with automaker Volvo to bring its LIDAR (light detection and ranging) tech into autonomous cars capable of safely driving on the highway. While companies like Tesla have come under fire due to safety issues with its self-driving technology, Jefferson noted how his company's tech differs. "Our LIDAR, its iris sensor that's really set for production, is able to sense, understand, and give the vehicle confidence to react accordingly such that you don't have these same types of issues," he said. The Ride Pilot technology in Volvo vehicles will be rolled out in California following safety testing.
The fintech app backed by billionaire Mark Cuban called Dave made its public debut on the Nasdaq Thursday via a SPAC merger. CEO and co-founder Jason Wilk spoke to Cheddar's Kristen Scholer about the IPO and how his company's services distinguish it from traditional banks. "Customers come to us because they're tired of paying $20 billion of overdraft fees, and they come to Dave, they download our app, and within minutes they can get access to $250 of no interest credit, which we give them through our own proprietary machine learning model," he told Cheddar.
Stephanie Linnartz, president of Marriott International, joined Cheddar's "Closing Bell" to talk about the launch of the Marriott Design Lab, a new facility within its Bethesda, Maryland, headquarters to explore innovative tech offerings for bolstering the guest experience. "It's all around figuring out how we can innovate in the guest room in the public space, looking at how we can use robotics, improve sustainability, etcetera," she said. Some short-term changes in the future Linnartz also noted is an expansion of the chain's mobile capabilities to make check-in and check-out an easier process for guests, as well as mobile room service, from the feedback it received during the pandemic.
