With inflation touching record levels, massive layoffs and uncertainty about the economy, it’s hard for many to focus on “ethics” while making investment decisions. Ethical or ESG investing, however, has gained a lot of traction as companies and governments become aware of the importance of making the right choices to solve problems like climate change, water scarcity, food insecurity and more.
Companies today spend a fortune and a lot of time in publishing their sustainability reports and long-term ESG targets. Sometimes it becomes difficult for investors to figure out exactly what counts as “ethical” when it comes to investing. The ESG space is littered with vague terms and generic statements without concrete value. Amid growing backlash from some investors, the industry is taking action to fix this problem. Bloomberg recently reported that The European Sustainable Investment Forum has started the process of revising its methodology to reach accurate market size of the ESG industry.
The Bloomberg report quoted Emilie Rowe, head of financial services at Aspectus Group, who said:
“Fund managers need to start thinking about the way they communicate their ESG credentials, offerings, and commitments to clients.”
Rower said some companies “will need to make pretty stark changes when it comes to their communications strategy.”
Is it possible to find ethical companies that make money in the modern world? Redditors like to keep it simple. Reddit investors who care about ethics while making investment decisions usually have a consensus that if you want to find ethical companies, it’s enough to stick to those that steer clear of what count as major ills according to many, including tobacco, carbon emissions, gambling, animal testing, producing extremely harmful kinds of water and air pollution, etc.
A couple of comments portray the collective wisdom of Redditors engaged in discussion boars on the social media platform about ethical investing. One Reddit user in the “Stocks” subreddit said:
“I only invest in companies/products/services that I want see do well in the future and will improve society. Your money has a lot of bargaining power. We can’t complain about the wage gap or unethical corporations if we are willing to naively invest solely for the purpose of making money. Our money will place millions of dollars into the hands of CEOs and shareholders, so we want our money to go into good hands.”
Redditors also support investing in companies that take the human society forward and add to the overall progress of our civilization. Here’s a comment of a Redditor depicting this mentality:
“Only companies, industries/technologies, solutions that move our society forward in a sustainable bountiful way. I vote with my dollars and take my roll as an investor as an opportunity to support what I believe in.”
Best Ethical Companies to Invest in According to Reddit
For this article we scoured several discussion boards on Reddit where hundreds of people have discussed their favorite companies for ethical investing. We consulted subreddits like Green Investor, Stocks, WSB, Investing, UKEthicalInvesting, among others, to find companies that Redditors believe are ethical enough to invest in. Most of the Redditors recommend ETFs that track ethical companies instead of putting your money in a single company. Some companies however came up frequently in discussions because of their ethical practices and sustainable business models.
Best Ethical Companies to Invest in According to Reddit
13. ASN Biodiversity Fund
Number of Hedge Fund Holders: N/A
Netherlands-based ASN Bank offers several sustainable, green and ethical investment options. Redditors frequently mention ASN Biodiversity Fund as a viable option for ethical investors. ASN Biodiversity Fund has a size of over 26 million euros. The fund uses capital from retail investors and invests in large funds and listed companies “that have a measurable positive impact on biodiversity and nature restoration through sectors such as agroforestry and sustainable fishery.”
Last year, the ASN Biodiversity Fund invested 2 million euros in The Food Securities Fund, which supports farmers in sub-Saharan Africa to increase food security.
12. Sage Potash Corp. (TSXV:SAGE.V)
Number of Hedge Fund Holders: N/A
Potash plays a key role in fertilizer production, can increase crop yields and increase resilience of crops against pests. Sage Potash Corp. (TSXV:SAGE.V) is a Canadian company that explores for potash. Sage Potash Corp. (TSXV:SAGE.V) is a popular stock among Redditors on “Green Investor” subreddit. In March, Sage Potash Corp. (TSXV:SAGE.V) announced a deal with RESPEC LLC to expand a mining project in Southern Utah. Sage Potash Corp. (TSXV:SAGE.V) will be deploying solution mining, which the company said has less environmental impacts when compared to traditional mining methods.
Redditors are fans of rocket and space companies and believe investing in these sectors will help the humanity in the long run. Rocket Lab USA, Inc. (NASDAQ:RKLB) was specially mentioned by some Redditors as a suitable option for those who want to invest in space and rocket technologies.
Earlier this month Rocket Lab USA, Inc. (NASDAQ:RKLB) said it will propel NASA’s TROPICS constellation of satellites into orbit across two missions from the company’s launchpad in New Zealand.
Beyond Meat, Inc. (NASDAQ:BYND) is one of the leaders in the plant-based meat industry. In February, Beyond Meat, Inc. (NASDAQ:BYND) jumped after the company said it is striving to become cash flow positive in the second half of 2023. For the full year Beyond Meat, Inc. (NASDAQ:BYND) expects its revenue to come between $375 million to $415 million while gross margin is expected to be in the low double-digit range, increasing sequentially throughout the year.
As of the end of the fourth quarter of 2022, 15 hedge funds tracked by Insider Monkey had stakes in Beyond Meat, Inc. (NASDAQ:BYND). The biggest hedge fund stakeholder of Beyond Meat, Inc. (NASDAQ:BYND) was Ray Dalio’s Bridgewater Associates which owns a $1.4 million stake in the company.
Calvert, a US-based investment company focused on responsible investing, was mentioned more than once on Reddit discussion boards for its ethical investment options. That’s why we decided to take a look at the company’s offerings and picked Apple Inc. (NASDAQ:AAPL), the top holding of Calvert US Large-Cap Core Responsible Index ETF. Apple Inc. (NASDAQ:AAPL)’s ESG scores are impressive and the company is investing heavily in ESG-related projects. That’s why Apple Inc. (NASDAQ:AAPL) ranks higher on several notable ESG ETFs.
As of the end of the fourth quarter of 2022, Apple Inc. (NASDAQ:AAPL) was one of the most popular stocks among elite hedge funds, according to Insider Monkey’s database of 943 hedge funds. 135 hedge funds tracked by Insider Monkey had stakes in Apple Inc. (NASDAQ:AAPL).
Polen Global Growth Strategy made the following comment about Apple Inc. (NASDAQ:AAPL) in its Q1 2023 investor letter:
“Not owning Apple Inc. (NASDAQ:AAPL) and NVIDIA detracted from our relative performance. With respect to Apple, we have not felt that the combination of growth available and the valuation made for one of our best ideas. Concerning NVIDIA, while there seems to be strong demand for data center chips, the valuation and lack of clarity around pace and magnitude of that growth has kept us at bay to date.”
When it comes to ethical investing, Redditors are big fans of water-related companies. Ecolab Inc. (NYSE:ECL) was specifically mentioned by several Redditors as the company is one of the leaders in the water treatment industry. Ecolab Inc. (NYSE:ECL) has an impressive ESG profile.
As of the end of the fourth quarter of 2022, 47 hedge funds tracked by Insider Monkey were bullish on Ecolab Inc. (NYSE:ECL), up from 42 hedge funds in the previous quarter.
Enphase Energy, Inc. (NASDAQ:ENPH) is one of the best ethical companies to invest in according to Reddit. Enphase Energy, Inc. (NASDAQ:ENPH) makes solar micro-inverters, battery energy storage and EV charging stations. These technologies are playing a key role in solving the climate change problem.
Earlier this month, Enphase Energy, Inc. (NASDAQ:ENPH) stock was upgraded by Piper Sandler to Overweight from Neutral with a $255 price target.
As of the end of the last quarter of 2022, 63 hedge funds tracked by Insider Monkey were bullish on Enphase Energy, Inc. (NASDAQ:ENPH). The biggest hedge fund stakeholder of Enphase Energy, Inc. (NASDAQ:ENPH) was John Overdeck and David Siegel’s Two Sigma Advisors which owns a $354 million stake in the company.
Costco Wholesale Corporation (NASDAQ:COST) came up frequently on Reddit discussion boards talking about ethical companies to invest in. Redditors praise Costco Wholesale Corporation (NASDAQ:COST)’s proactive approach in increasing wages and overall employee benefits. Employee reviews for Costco on Glassdoor also back this sentiment, with hundreds of comments appreciating Costco Wholesale Corporation (NASDAQ:COST)’s work culture and benefits.
Insider Monkey’s database of 943 hedge funds shows that 66 hedge funds had stakes in Costco Wholesale Corporation (NASDAQ:COST). The biggest hedge fund stakeholder of Costco Wholesale Corporation (NASDAQ:COST) was Ray Dalio’s Bridgewater Associates which owns a $428 million stake in the company.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
