One of my favorite areas of investment has been steadily gathering momentum; that is solar and energy efficiency stocks. In my view, the key to any success lies in how one approaches investment and the moves that one makes according to a long term strategy. We were talking about metals and energy stocks six years back, and for the last one year I have been talking about alternative energy stocks. Indeed, we are still at a very early stage with this sector and there is immense potential waiting to be exploited. As you may recall, I have periodically mentioned about this sector several times since 2006, and there’s a good reason for that. As a matter of fact, if I had $100, I would invest 35% to 50% in alternative energy related areas and reduce positions in metals and oil stocks by 90%.
A lot of people are co-relating oil and alternative energy because they think that alternative energy stocks are moving up because of oil. However, I hold a different view and think that a new technology will replace natural product “oil” in the next ten years. Twenty years ago, we hardly knew about email and the internet, but the whole world now depends on it. So great is our reliance on this technology that there would be unprecedented chaos if the facility was to be suddenly interrupted the world over.
Technology in the world is changing every day and though we barely realize, it gradually becomes part of our life. It is like the graying of the hair: it comes slowly and we realize that we are growing old (when they starting coming and how suddenly they are many); and the white hair becomes a part of our life whether we like it or not.
I see a revolution in the energy or power sector within the next fifteen years, like what happened in telecommunication and internet in the two decades. My recommendation at this stage is therefore buying alternative energy stocks for the longer term, for we may see new Google’s or Microsoft’s being born in this area. I will consequently not put any additional money in gold/silver stocks or oil, but in alternative energy because this sector will play a key role in world economy and the betterment of human life.