TradeRepublic now finally with #etfs from #vanguard , #vaneck and #invesco.
And a #sparplan can now be executed like other #brokern also be executed from 1€ and also weekly.
Class optimizations, improvements. Now still the allowance for the spouse can deposit. 👍
How do you see the changes? What are you missing #traderepublic still missing?
Sustainable investing
Climate change is one of the existential problems that we as humanity need to solve. Learn here how the energy transition contributes to the solution and how you can invest in it.
(Alternatively, go directly to the video here https://bit.ly/3L543r5)
The practice of investing money has always been a fairly simple equation. You invest a certain amount of money and hope for a financial return above the market rate. In recent years, however, a new variable has entered the equation: sustainability.
It's no secret that energy demand has skyrocketed around the world, driven primarily by fast-growing emerging economies and non-OECD countries. By 2050 alone, global energy consumption will increase by nearly 50%. Yet since 1992 and the Kyoto Protocol, industrialized countries have been trying to find a smart way to reduce man-made CO2 emissions. Regardless of whether this agreement (and those that followed) is used only as a political tool or whether it is to be implemented permanently, one thing is clear: fossil fuels cannot be the way of the future, and a transition to more renewable energies is necessary.
Global warming is a real problem, not only from an environmental perspective, but also from a societal perspective. Recent climate disasters, such as the heat wave in Europe and the monsoon floods in Pakistan, underscore just how much a few extra degrees can have long-term consequences. Since the apex of the Paris Agreement in 2016, countries have finally recognized the need for collective action, which has helped advance policy and regulatory frameworks. This has finally paved the way for more innovation and additional investment in this area.
From 2020 to 2021 alone, more than $501 billion was invested in the energy transition via clean tech products and projects, according to Bloomberg's New Energy Finance 2021 report. This increase is a welcome consequence of the unprecedented commitments that major economies have made in recent years to achieve the climate transition. A big signal came from the U.S. through its re-entry into the Paris Climate Agreement (which it should never have left) and its $2 trillion investment plan in clean energy to deliver CO2-free electricity by 2035. At the same time, the world's largest greenhouse gas emitter, China, laid out a plan to achieve its CO2 emissions before 2030 and become CO2 neutral before 2060. Meanwhile, the fossil fuel industry is feeling the heat at its back to invest in clean energy.
Currently, about 80% of our energy still comes from fossil fuels. To achieve CO2 neutrality, we would need to get at least 60% of our energy from renewable sources by 2050, and as much as 10% by 2025. This is easier said than done, especially when you consider that fossil fuels have an extremely high energy density and can be used almost anywhere, since the appropriate infrastructure is in place. Few alternative energy sources can compete with fossil fuels when it comes to generating energy on demand. Furthermore, the fact that they have been used as the main source of energy for centuries means that the logistics are well established and a complete rethink of how we consume and understand energy is needed.
What actually is solar energy and is it the future?
Solar energy is divided into solar photovoltaics and solar thermal energy. Photovoltaics is the direct conversion of light energy, mostly from the sun's rays, into electrical energy. This is done by means of solar cells. Solar thermal energy converts sunlight not into electricity, but into heat, thanks to so-called solar collectors. This heat can be used for various purposes, such as powering an electrical generator by producing steam.
By 2050, a 20-fold increase in total capacity is predicted, which will make solar energy the largest single source. Germany and the U.S. are not the only countries relying on solar energy. In China, too, the use of solar plays a major role. The Middle Kingdom leads the world in the use of solar energy, accounting for 36% of the world's installed solar capacity in 2020.
Green energy competes with fossil fuels in economic efficiency
While lack of political attention has certainly been one of the headwinds for renewable energy deployment in the past, weak cost competitiveness has been an even bigger problem.
In 2010, solar PV energy was still about six times more expensive than coal. By 2021, costs were nearly on par with fossil fuels, and at least since the energy crisis created by Russia's war of aggression against Ukraine, solar power has been far cheaper than power generated by fossil fuels. Even if fossil fuel costs fall to 2021 levels, renewable energy will cost less than oil, natural gas and coal-fired power by 2040, according to the International Renewable Energy Agency (IRENA). In addition, large-scale projects such as hydropower plants or onshore solar wind farms cannot be built just anywhere. Hydropower plants need a constant water supply, while wind farms require a large amount of land. Some countries have plenty of it, others do not. This, combined with limited funding from local governments, has made investors wary of putting their money into such projects.
New wind and solar projects are finally becoming competitive, driven by economies of scale, more competitive supply chains and technology improvements. Between 2019 and 2021 alone, generation costs for solar PV have dropped by 82%, for onshore wind by 38%, and for offshore wind by 29%.
In addition to pure renewables, clean fuels such as hydrogen have also become very popular recently, to say the least. While renewables require dedicated infrastructure, both in terms of energy production and storage and transportation, hydrogen can rely on existing infrastructure such as gas stations and oil transport vehicles, which require little conversion to be usable.
In addition, hydrogen has extreme energy density: 1 kilogram of hydrogen gas contains about three times as much energy as oil, but can be produced from both renewable energy and fossil fuels. Hence the distinction between green and gray hydrogen. The problem with clean hydrogen is the production chain and whether enough can be produced at all to meet the growing demand.
Environmental protection, social justice and return on investment need not be mutually exclusive; in fact, they can be mutually reinforcing. Studies have repeatedly shown that sustainability criteria in investments have an above-average positive effect on economic success. ESG standards can be seen as a kind of seal of approval for the financial industry. Environmental, Social and Governance (ESG) is an acronym that stands for ecological orientation, social orientation and responsible corporate governance.
So what about investments?
One thing is clear: For the energy transition to succeed, countless investments are needed in addition to improving economic efficiency. Just to meet the target set out in the Paris Agreement - to limit global warming to less than 2°C and ideally to 1.5°C - annual global investments in renewable energy would need to increase significantly. In 2018, these averaged $300 billion globally. But this amount would need to nearly triple to an annual $800 billion by 2050. Limiting global warming to 2 °C will require not only an increase in renewable energy investment, but also a significant expansion and reform of the entire related technological ecosystem.
While this will be a challenge, from an investment perspective it means that even more companies will enter the climate transition, not only as pure energy producers, but also as supporting companies. For investors, this results in a growing range of stocks to buy.
To learn more about investing in sustainable companies and technologies, visit Invesco's website!
The future is... decentralized?! What is behind the blockchain?
Why is the Blockchain so revolutionary? Nowadays, transactions are mainly organized by intermediaries and third parties, such as Paypal or your house bank. Through the Blockchain, this process can be automated and thus processed faster. A day thus becomes a few seconds. The transparent representation of transactions and the decentralized recording of them, should give the trading partners the mutual security that would otherwise only have been possible through traditional payments. This new type of finance is called "Decentralized Finance" - DeFi for short.
Possible uses of blockchains!
Non-fungible tokens, or NFTs for short, are another function. There is a similar logic behind them as behind cryptocurrencies. They are also tokens that are located on a blockchain and can be traded. NFTs can be certificates, birth certificates, vaccination certificates, but also art and digital objects.
In addition, all the companies needed to build a car, meaning all the raw material suppliers, subcontractors, logistics companies, and ultimately the manufacturers of the cars, can organize themselves in a common blockchain. This will allow supply chains to be better tracked and data to be shared more efficiently.
What does the Metaverse have to do with blockchains?
At the latest since Facebook renamed itself Meta, the Metaverse has reached the mainstream. Broadly speaking, the term metaverse refers to a virtual space or world where people can interact with each other using virtual reality technology and avatars. Blockchain also plays a role here, enabling items, avatars, or even digital homes to be traded using NFTs.
If you want to learn more about the topic, we've written a short video and blog post on the subject. You can find it here: https://bit.ly/3BcqzcK
