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Green investments: 4 ways to invest with impact

Rethink how you grow your money with these green investments, and find out which green stocks to watch.

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Gone are the days of choosing between sustainable change and growing your wealth. Turns out, you can do both. Here are 4 types of green investments that can help you grow your wealth while backing the production of goods and services that protect the environment.

1. Green stocks

Green stocks let you invest directly into businesses that produce goods or services related to protecting the environment. Examples include renewable energy companies and electric vehicle manufacturers.

When you own stocks in a company, you own a small portion of that business. As a stockholder, you don’t take part in day-to-day operations. You may be able to vote in corporate shareholder meetings, but otherwise, you simply buy stock and either hold it or sell it whenever you choose.

Here are some green stocks that may be worth watching:

Stantec logo

Stantec Inc. (TSX: STN)

Stantec provides engineering, architecture and environmental consulting services in the areas of infrastructure and facilities in Canada, the US and other international markets. It has been ranked as one of the most ecofriendly companies in Canada and one of the most sustainable companies in the world.

  • Industry: Engineering & Construction
  • Exchange: TSX
  • Dividend yield: 1.12%
  • Price-earnings (P/E) ratio: 36.54
Buy STN on CIBC Investor's Edge

Brookfield logo

Brookfield Renewable Partners L.P. (TSX: BEP-UN)

Brookfield Renewable Partners L.P. owns a portfolio of renewable power generating facilities primarily in North America, Colombia, Brazil, Europe, India and China. The company generates electricity through hydroelectric, wind, solar, distributed generation, pumped storage, cogeneration, and biomass sources.

  • Industry: Utilities—Renewable
  • Exchange: TSX
  • Dividend yield: 3.26%
  • Price-earnings (P/E) ratio: N/A
Buy BEP-UN on CIBC Investor's Edge

Northland Power logo

Northland Power Inc. (TSX: NPI)

Northland Power is an independent power producer that develops, builds, owns and operates clean and green power projects in North America, Europe, Latin America and Asia. The company produces electricity from renewable resources such as wind, solar or hydropower as well as clean-burning natural gas and biomass.

  • Industry: Utilities—Renewable
  • Exchange: TSX
  • Dividend yield: 2.67%
  • Price-earnings (P/E) ratio: 18.80
Buy NPI on CIBC Investor's Edge

Boralex logo

Boralex Inc. (TSX: BLX)

Boralex develops, constructs and operates renewable energy power facilities primarily in Canada, France and the United States. The company holds interests in many wind power, hydroelectric power and solar power stations as well as a thermal power station.

  • Industry: Utilities—Renewable
  • Exchange: TSX
  • Dividend yield: 1.32%
  • Price-earnings (P/E) ratio: 86.93
Buy BLX on CIBC Investor's Edge

Evergen Infrastructure logo

EverGen Infrastructure Corp. (TSX: EVGN)

EverGen Infrastructure acquires, develops, builds, owns and operates a portfolio of renewable natural gas, waste to energy and related infrastructure projects in British Columbia. It operates an anaerobic digestion facility, the Zero Net Waste Abbotsford project, the Sea To Sky Soils project, the GrowTEC project and the Radius project.

  • Industry: Utilities—Regulated Gas
  • Exchange: TSX
  • Dividend yield: N/A
  • Price-earnings (P/E) ratio: N/A
Buy EVGN on CIBC Investor's Edge

2. Green bonds

Green bonds are just like regular bonds, but funds go toward environmental projects to fight climate change, prevent pollution, protect ecosystems, provide clean water and more.

You can diversify your investments with green ETFs that hold many securities. Some popular green bond ETFs are:

  • Horizons S&P Green Bond Index ETF (TSX: HGGB)
  • Wealthsimple North American Green Bond Index ETF (NEO: WSGB)
  • Mackenzie Global Sustainable Bond ETF (NEO: MGSB)
  • VanEck Vectors Green Bond (NYSEArca: GRNB)
  • iShares USD Green Bond ETF (NasdaqGM: BGRN)

In 2021, the Government of Canada announced the Green Bond Program, a fixed-income debt security issued by governments or companies to fund environmental initiatives. Individuals can invest by buying into ETFs or mutual funds that hold green bonds.

3. Green ETFs

Invest in climate change with exchange traded funds (ETFs) that hold stocks in hundreds of individual companies focused on improving the planet. Popular green ETFs include:

  • Harvest Clean Energy ETF (TSX: HCLN)
  • First Trust Nasdaq Clean Edge Green Energy ETF (TSX: QCLN)
  • Invesco WilderHill Clean Energy ETF (NYSEArca: PBW)
  • iShares Global Clean Energy ETF (NasdaqGM: ICLN)
  • Invesco Solar ETF (NYSEArca: TAN)
  • First Trust Global Wind Energy ETF (NYSEArca: FAN)
  • Global X CleanTech ETF (NasdaqGM: CTEC)

4. Green mutual funds

These funds are made up of socially conscious companies looking to promote environmental responsibility. For example, the Aspiration Redwood Fund is a fossil fuel–free fund comprising sustainable businesses focused on people and the planet.

Examples of green mutual funds include:

  • Trillium ESG Global Equity Fund (Nasdaq: PORTX)
  • Shelton Green Alpha Fund (Nasdaq: NEXTX)
  • Thornburg Better World International Fund Class I (Nasdaq: TBWIX)

Other ways to protect the environment with your money

Investing isn’t the only way to support environmental protection initiatives. You can also take part in crowdfunding campaigns, donate to environmentally-focused organizations and spend on ecofriendly brands.

Invest in crowdfunding campaigns for green businesses

There are crowdfunding sites for almost everything these days—real estate, peer-to-peer lending, donations and even green businesses. If you’re eager to help a budding business and make an impact on the environment, here are a few platforms to check out:

  • Indiegogo. This crowdfunding giant has an entire section on its website dedicated to the Environment, as well as a section on Energy and Green Tech. Simply read through campaigns under each section, and fund any that align with your values and goals.
  • Startsomegood. This platform splits its environmental causes up by niche categories like animal rights, disaster response, human rights, food and more. Pick a category that’s dear to your heart and fund any campaigns that resonate with you.
  • FrontFundr. FrontFundr is a Canadian-regulated website that prides itself on connecting investors and business directly. It allows many types of campaigns to run on the site, welcoming both new and seasoned investors to participate in campaigns.

Donate to an environmental protection group

Sometimes the most effective way to make a change is to donate to the organizations that are already making a difference. There are several environmental charities and groups that have strong, evidence-based track records for actively fighting climate change. Some of those are:

  • Environmental Defence Canada. This Toronto-based environmental advocacy organization that aims to protect clean water sources, fight climate change, combat pollution and take action against social inequalities produced by environmental problems.
  • Environmental Defense Fund. As one of the world’s leading environmental organizations, the EDF is making strides toward creating solutions for issues like global warming, human health, overfishing, pollution and more.

Spend on eco-friendly brands

Look at what brands you’re currently spending your money on and see if there are any eco-friendly alternatives. For example, Beyond Meat makes meat alternative products and is available in major grocery stores like Sobeys, Whole Foods, Freshco, Foodland and more.

If you’re looking for ecofriendly clothing, check out Free Label, which focuses on producing Canadian-made clothing using sustainable materials and ethical employment practices. You can also take a look at Thesus (formerly Alice + Whittles), which makes quality women’s footwear using mostly sustainable materials.

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Bottom line

There’s never been a better time to invest for the environment—whether you want to buy green investments, make charitable donations or buy ecofriendly products. Think through your financial goals, then choose the methods that will empower you to put your dollars to good use.

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Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

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