How can you make money from this whole global warming thing? I mentioned back in January that I was investing in a water resources portfolio (PHO) under the theory that water would be the next bubble. So far I’m up 9%, but the market is up in general, so that’s no big deal. Global warming is predicted to cause massive droughts in some places, so this seems like a good hedge.
But it got me thinking that there must be a way for believers in global warming to profit at the expense of skeptics, assuming the believers are right. For investment purposes it doesn’t matter what is causing global warming. All that matters is that it is happening and apparently already unstoppable according to a growing consensus of scientists.
The obvious stock plays have already been run up. If you invest now in solar, wind, and other green energy players, you might be getting in late. And some other better technology could overtake them. I’m looking for an investment that doesn’t involve green technology.
For example, I already play soccer and tennis at indoor facilities. If there was a stock you could buy in some company that was building indoor sports clubs that would be a good play. You’ll need them when it gets hotter.
Food supplies will be disrupted in some places and maybe improved in others. If you could find a way to invest in an agribusiness that has its operations in places likely to have improved growing conditions with global warming that might be a play.
Maybe real estate is the way to go, but it’s harder to diversify. The idea is to find places that have just okay weather now that will have terrific weather later. That seems too risky. Real estate is influenced by too many other factors.
The best investment hedge might be as simple as a portfolio of sunscreen manufacturers.
What are your global warming investment ideas? And resist the urge to say, “beachfront property in Idaho.”