Saxo Markets' Most Traded Sustainable Stocks in Australia
Summary: As the COP26 climate conference comes to a close this week, the word on everyone's lips is "sustainability". In the global effort to combat climate change, it is becoming increasingly clear that investment and finance will play a crucial role.
Wealthy nations have already pledged more than $100 billion in climate financing initiatives, while some of the world's largest institutional investors are "greening" their portfolios to the tune of trillions.
Perhaps this is why Saxo's Australian clients have continued to buy and sell shares in companies with significant green interests, including some of the largest green energy and technology companies on the planet. With this in mind, we have looked at some of the most popular sustainable stocks traded by our Australian clients which feature on the Corporate Knights’ Most Sustainable Companies 2021index, a ranking of the major companies that are leading the way with ambitious climate actions. These are the most popular sustainable stocks that feature on that index.*
1. Tesla Inc.
Given this company's position as the world's largest manufacturer of low-emission automobiles, it should come as no surprise that Elon Musk's Tesla is the top stock pick for 2021 for our Australian clients. The corporate giant became the fifth company in US history to pass the $1 trillion valuation mark recently, with its stock price increasing 65% to $1164 per share since the start of the year. As the world seeks to decarbonise, it's clear that Tesla's dominant market position will keep it in high demand.
2. NVidia Corp.
One of the world's top producers of computer chips and graphics processing units (GPUs), as well as a gaming industry titan, NVidia has gone from strength to strength in 2021. Record demand for chips is likely to push Nvidia's annual revenues to their highest level ever, while market sentiment in the company is clearly bullish, given the 96% increase in its stock price since January, putting Nvidia at $258.11 per share as of November 1. While NVidia ranks 100th on the Corporate Knights Global Index of sustainable companies, it has reduced its manufacturing emissions by 15% per employee since 2014, making it one of the greenest chip manufacturers around right now.
3. Alphabet Inc.
Known best as the company behind Google, it can be hard to describe exactly what Alphabet sees itself as, given that it has its fingers in so many pies. Social media, AI, solar panels, driverless cars, health technology - there are few growth industries that Alphabet is not deeply involved in. It is the success of these investments that have sent Alphabet's share price up 68% since January, which now sits at a hefty $2908 per share.
4. National Australia Bank Ltd.
The NAB is the 21st-largest bank on the planet with more than $800 billion in assets worldwide. It is also one of the most consistently popular stock picks for our Australian clientele. The bank ranks 44th on the Corporate Knights Global Index, despite its past investments in fossil fuel companies. This is because the NAB has divested and is now on track to have invested $70 billion in low-carbon activities by 2025, making it one of the major players in global green financing.
5. Intel Corp.
Intel is the world's largest manufacturer of semiconductor chips - a product that has experienced unprecedented demand (as well as shortages) across 2021. With a $153 billion market cap and net profits of $20 billion last year, few companies are in better shape than Intel. The tech giant is also increasingly flexing its sustainability muscles, recently transitioning to a 100% renewable energy supply in the US and Europe, an unprecedented move for a company in such a carbon-intensive industry.
6. Taiwan Semiconductor
Described in some quarters as the most important company in the world, semiconductor chip manufacturing giant Taiwan Semiconductor has proven to be a hugely popular stock pick for Australian investors in 2021. Other major industry players such as Intel, Nvidia, and Apple are all customers of TSMC, which has helped to push its sales to the highest level ever recorded in 2021. Meanwhile, the company has committed to net-zero by 2050, making this a boon for any green investor.
7. Autodesk Inc.
The Silicon Valley software giant Autodesk Inc. is another tech bigwig that has interests in a staggering variety of sectors. CGI, engineering, marketing, platform design, and 3D printing are the main activities of this $4 billion a year company, but that only scratches the surface of its products and services. Autodesk is another US tech giant that has had a good year on the stock market, with its price rising 6% to $314.92 since January.
8. Vestas Wind Systems A/S
How we produce the energy we consume will largely determine the outcome of the climate emergency. We all know that wind power will play a crucial role in the energy transition, which is perhaps why the biggest players in the wind power market have attracted huge amounts of attention from investors. This is the case with Vestas, a Danish manufacturer of wind turbines which is currently the largest wind company in the world and ranks 21st on the Corporate Knights Global Index, along with €12 billion in annual revenue for 2020. Increasing recognition of wind power as the future of electricity helped to double the Vestas share price since early 2020, as the company continues to widen its market lead.
9. Brambles Ltd.
Brambles is an Australian company that is a major global supplier of loading equipment, pallets, and shipping containers, all products that are essential to international trade and in higher demand than ever as economies roar back to life. The $4.6 billion company attracted huge amounts of attention earlier in the year when the supply chain crisis put Brambles' products and services in huge demand. Interesting, Brambles is also ahead of the pack when it comes to climate commitments, having signed up to the 1.5 degrees commitments of the Paris Agreement and making independently-decided, science-based carbon reduction decisions in its supply chain.
10. Cisco Systems Inc.
The Silicon Valley software titan Cisco has also had a good year on the stock market, with its share price rising almost 30% in 2021 so far, currently sitting at around $57.62 per share. Cisco has a market cap of $230 billion, making it one of the most highly valued players in Silicon Valley today. This is partly due to its position as the world's pre-eminent telecommunications and cybersecurity provider, which has helped to keep investor interest high for decades now. In addition, Cisco is one of the top-ranked companies in the Corporate Knights Global Index at rank 13, thanks to its impressive emissions reduction pledges and it being one of the few official corporate partners of COP26 this year.
As our ranking of the most popular Australian stock picks for 2021 so far shows, sustainability is in. As COP26 unfolds and sustainable finance rises up the agenda, investors around the world will continue to look for green alternatives to put their cash into.
All trading carries risk. Any past performance stated is not an indication of future performance.
*List only includes stocks traded by Saxo’s Australia customers between 1 January and 27 October 2021.
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