Four positive investments that AREN’T connected to global stock markets

Written by Lori Campbell on 30th Mar 2020

Coronavirus has sent stocks plunging like few other events in the history of financial markets.

The FTSE 100 has dropped by a third in the last month, and other indices such as the S&P 500, Japan’s Nikkei, and Germany’s Dax are all in roughly similar positions.

It’s a disorientating time for investors, with many unsure what to do for the best. But with the pandemic throwing a spotlight on the fragility of the planet and society itself, funds that make a positive impact seem best placed to come out well in the long run.

Lisa Ashford, CEO of positive investment specialists Ethex, told Good With Money: “The Covid 19 pandemic has demonstrated the fragility of traditional capitalist business models to systemic shocks and the need for organisations to play a much more important role in building fair, resilient sustainable communities and societies.

“Investing directly in businesses that are helping to create a more sustainable world in my opinion is a good long term investment strategy as these businesses may well be less volatile in the long run.”

Although the financial stock markets are highly sensitive to the coronavirus outbreak, there ARE positive funds that are what’s called ‘uncorrelated’, meaning they tend to perform independently – often in opposition to – the movements of the wider markets.

Here we round up our top four:

 

Renewable energy – Low Carbon Hub

Returns from renewable energy are typically considered uncorrelated from the wider stock market – they come from the price of electricity generated and the subsidy that the project receives.

Low Carbon Hub is out to prove that we can meet our energy needs in a way that is good for people and for the planet.

The social enterprise creates and manages renewable energy projects for businesses, schools, and communities across Oxfordshire. By reinvesting 100 per cent of surplus energy into the communities, it further lowers carbon emissions. Low Carbon Hub also works on reducing energy demand, improving the energy efficiency of buildings and encouraging behaviour change around energy use.

In 2018, Low Carbon Hub set up a dedicated Community Energy Fund to offer investors a more flexible way to invest. It is aiming to raise £1.5 million through Ethex in this round to grow its portfolio of renewable energy generation projects.

With a minimum investment of £250, the targeted rate of return is five per cent after four years.

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Green transport – Co Cars

The coronavirus crisis has thrown a good light on the sharing economy and the need for shared transport solutions may increase as the economic impact of the pandemic continues to bite.

Co Cars provides low carbon, on demand, affordable shared mobility for all to create greener, calmer, more connected urban areas.

Founded in 2005, its network of nearly 40 on-street hybrid and electric cars stretches across the South West from Salisbury to Falmouth. In Exeter, Co Cars operates a docked, on-street electric bike hire network.

Co Cars gives people access to the transport they need, when they need it and at an affordable price. By reducing the need to own a fossil-fuelled or electric cars, it helps to tackle air pollution and traffic congestion.

In Exeter, its biggest network, Co Cars has over 1200 active members who can book and access on-demand 30 cars and 95 electric bikes 24/7 via their smartphones.

Cars can be booked from as little as half an hour and bikes in increments of 20 mins. The scheme has already taken 150 cars off the road, removing 149 tonnes of CO2 from the atmosphere every year.

Co Cars is aiming to raise £600,000 in a share offer through Ethex. The investment will enable it to increase its Exeter car fleet to at least 55 shared cars, of which over half will be fully electric, and to expand its electric bike network to a minimum of 150 bikes. Its goal is for everyone in Exeter being no more than a 10 minute walk from a Co Car. It also aims to increase its reach outside of the South West.

With a minimum investment of £250, Co Cars aims to pay five per cent interest per year.

 

Solar energy – Repowering London

Not-for-profit co-operative Repowering London empowers communities to fund, install and manage their own clean, local energy – while also getting a return on their investment.

The aim is to put people at the heart of the energy system, not only to help fight the climate emergency by creating net zero emissions, but also to build resilient communities and promote technological innovation.

Its latest project – North Kensington Community Energy (NKCE) – will soon be opening its second share offer. The aim is to raise £106,000 to install 138 kWp of solar panels in North Kensington’s Westway Trust area. The solar panels will save 28 tonnes of CO2 a year and create a £35,000 Community Fund.

 

Tidal energy – Atlantis Future Energy

Atlantis Future Energy is the latest and largest offer to date from SIMEC Atlantis Energy – the world’s most experienced tidal power developer.

This offer will enable the company to accelerate its growth by developing more tidal power and a first-of-its-kind power plant conversion. It will convert the previously coal-fired Uskmouth power station to generate power from sustainable energy pellets made from organic waste and residual waste plastic which would otherwise have gone to landfill.

Atlantis is also developing tidal energy projects through its MeyGen project and plans to commit resources to design and build an array at Raz Blanchard, a fast-flowing tidal race off north-western France which is one of Europe’s most promising tidal stream sites.

This offer, available through Abundance, offers a potential return of 8 per cent interest per year for 5 years.

Edit: This investment is now fully subscribed but is still available through the Abundance Marketplace feature – where Abundance investors buy and sell holdings from each other (a service offered for free). To see and use the Marketplace you must be signed up to Abundance.