Just saw a headline on TV a few days ago. “ESG investing without return is simply not sustainable”. That totally makes sense. No argument about it. However, I personally think that the key is not whether there is return but whether there is return in short term or long term.
ESG stands for Environmental, Social and Governance. In short, the do-gooder investing. 😊 The investment horizon is the most important in the whole world of investing. Also, short-term or day trading is like gambling. Technical analysis is so self-deceiving and lack of humility. The financial world is like a black box or a wok of soup with so many ingredients acting together, but we have this unrealistic hope that we can predict how it is going to taste.
If long-term with slow and steady style is the way to go for investing, then ESG should have made sense. With all the natural disasters so frequent and devastating, it seems like a no brainer.
The oil stocks performance has been one of the best in the past 12 to 18 months. Many investing pros suggested to buy them. I am just not sure that oil stocks are good for long-term.
ESG didn’t do well during the same period. In ESG ETF, there are a lot of technology stocks that plummeted since last December. One reason is the high evaluation of the tech stocks during pandemic.
I just don’t like the high management fee of the ESG. They are mainly tech stocks anyway for now if we look underneath the surface.
Now, the Nasdaq 100 ETF price is down around 35% from the December peak. It might be time to buy some if you need some tech and ESG exposure.