Nearly half of U.S. investors say clean energy is next Dotcom crash waiting to happen

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New survey finds more than 70% of investors are disappointed with clean energy performance this year, and 13% will sell their clean energy investments within a year of Biden’s presidency

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Similarities Between the Clean Energy Industry and the Dotcom Crash

New York, NY, October 18, 2021 – Nearly half (46%) of U.S. investors see similarities between today’s clean energy industry and the dotcom crash of 2000, Investing.com revealed today in recently released data.

Clean energy

According to a survey of more than 1,200 respondents, 70% of investors are disappointed with clean energy performance under President Joe Biden, including 41% who said the investments were “well below” their expectations . Thirteen percent have confirmed they will sell their clean energy investments now, less than a year after starting Biden’s presidency.

The survey results come amid the relative underperformance of clean energy in the market against the high expectations that were set at the start of the Biden administration. More than 40 percent of those polled said investors jumped on the clean energy bandwagon too early. Thirty-one percent attributed the sector’s underperformance to Biden failing to deliver on campaign promises, and 29 percent cited supply chain issues associated with the economy reopening after the COVID-19 lockdown. More than 90% said the performance of clean energy stocks was linked to government policy, with 46% who rated the connection as “strong.”

“The underperformance of many clean energy stocks this year comes as investors realize profits, following strong industry gains throughout 2020,” said Jesse Cohen, senior analyst at Investing.com. “As the trade grew increasingly crowded in the first quarter of this year, smart money – which poured into the industry even before Biden was elected – headed for exits.”

Clean energy

Investments in clean energy stocks or ETFs

Of the survey respondents, 45 percent identified as having investments in clean energy stocks or ETFs. One in five invested people introduced clean energy to their wallet after Biden was elected president, while about one in four people specifically made these investments because of their perception of the growth potential of the sector under Biden.

It turns out that Biden wasn’t the only public figure behind the investments, with 28% of those polled saying Tesla chief Elon Musk had a role in their decisions, at least to some extent. . It is therefore not surprising that Tesla stock is in the portfolios of almost 40% of clean energy investors in the survey, with almost 35% investing in Pacific Ethanol as well as around 30% in Plug Power and Nio. The most popular ETFs with clean energy investors, meanwhile, were iShares Global Clean Energy (34%), Invesco Solar (23%) and First Trust Nasdaq Clean Edge Green Energy Index Fund (20%).

“Companies involved in the low-carbon energy industry, such as solar panel manufacturers and wind turbine manufacturers, as well as companies working throughout the electric vehicle supply chain, are expected to benefit the most from the ongoing shift to alternative energies, ”Cohen added. “Some names that are likely to outperform in the coming months include NextEra Energy, the largest electric utility in the United States, as well as companies such as First Solar, SolarEdge Technologies, Plug Power and Sunrun. Looking elsewhere in Europe, Denmark’s Vestas Wind Systems, the world’s largest wind turbine manufacturer, and Italian electrician Enel should also do well.

Of those who avoided investments in clean energy, nearly 30% did so because of skepticism about the sector’s potential in the market, regardless of the U.S. president, while 22% were kept away from investments. specifically because they think Biden’s policies won’t have a positive impact on the industry. Twenty-eight percent of those polled said the performance of clean energy stocks in 2021 had strengthened their position against such investments, although nearly half (47 percent) said this year’s events didn’t had had no impact on their outlook.

Looking ahead, the survey found that there is at least some optimism about investing in clean energy. Almost 70 percent of investors anticipated some growth in the value of the sector in the coming year, although 29 percent expected the value to increase by less than 10 percent. About 14% expect a year of stagnation in which the sector will remain at its current value.

The full story is on Investing.com.


Methodology: This survey was conducted from October 4 to 6, 2021 based on an online survey of 1,229 American adults from the Investing.com user database. The poll has a margin of error of plus or minus 2 percentage points.

Updated

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