The global energy transition is a transformative theme still in its early stages, and companies well-positioned to capitalize on the increasing investment in technologies supporting the evolution of energy infrastructure can provide substantial opportunities for investors. This is according to new insight from Morningstar based on the Morningstar Global Energy Transition Index.
Andrew Bischof, CFA, CPA – Equity Strategist, Morningstar Research Services, LLC:
“Addressing carbon gas emissions will require significant investment and present material growth opportunities in the Energy sector. The sector is overwhelmingly responsible for GHG emissions and opportunities will be present across companies investing in renewable energy, hydrogen, and battery storage. Key holdings, such as NextEra Energy (NEE), are well-positioned to benefit from this investment opportunity that we think will last decades. NextEra Energy is the largest renewable energy developer in the US and is benefitting from improving renewable economics that is supporting continued adoption driving above average industry growth.“
Andrew Lane – Director of Equity Research, Index Strategies, Morningstar Research Services, LLC:
“The Morningstar Global Energy Transition Index draws on the in-depth knowledge and forward-looking insights of Morningstar’s equity research team to deliver unparalleled, thematically pure exposure to the energy transition theme. This research-based thematic index provides broad exposure to a transformative theme with considerable growth potential. Through a thorough, standardized scoring process that incorporates Morningstar analyst insights, the index targets stocks that are expected to benefit from innovations in Renewable Energy, Energy Storage, Hydrogen and Carbon Capture Technologies."
Invesco Canada recently introduced a new ETF, the Invesco Morningstar Global Energy Transition Index ETF (Ticker: IGET) based on the Index to Canadian investors.
Pat Chiefalo – Senior Vice President, Head of ETFs & Indexed Strategies, Invesco Canada:
“We are always looking to offer investment products that can provide clients with new and unique ways to meet their desired investment outcomes. Our new ETF based on Morningstar’s global energy transition index uses dynamic elements and relevant themes to offer a strategy that is relevant in the current macroeconomic environment.”
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