While researching 2021’s top market trends, a piece in Forbes caught my eye.
Adam O’Dell, Charles Sizemore and I have been bullish on the energy sector lately as we believe the recent rotation out of tech provides tailwinds to the sector.
Pro tip: Charles recently recommended a pair of strong energy plays in the March issue of Green Zone Fortunes. To learn how to access the tickers for these stocks, click here.
The Forbes article took that a step further, illustrating why clean energy stocks, in particular, are poised for a big run in 2021.
And here’s why that matters for you.
Tax Credits Will Spur Renewable Energy
If there is one thing that will help a particular sector of the economy, it’s federal tax credits.
These credits can spur expansion for a manufacturer or entice consumers to buy a particular product.
Solar was a prime example of how an industry capitalized on federal and state tax credits.
From 2010 to 2019, solar power generation went from 1.2 billion kilowatt-hours to 72.2 billion — a nearly 6,000% increase.
That spike came at the height of the Solar Investment Tax Credit, which allowed homeowners and businesses to deduct 26% of installation costs from federal taxes.
Now, Congress is focusing on long-term energy incentives that will further boost not just traditional energy stocks but renewable energy stocks as well.
Buy the Invesco WilderHill Clean Energy ETF (ARCA: PBW) for Easy Diversification
Increasing energy tax credits will further boost renewable energy companies. It gives residences and businesses incentives to install renewable energy products.
Rather than sift through hundreds of renewable energy stocks, I found an all-encompassing way to invest: the Invesco WilderHill Clean Energy ETF (ARCA: PBW).
This exchange-traded fund (ETF) invests in a wide range of energy, utilities and alternative energy stocks.
In this episode of The Bull & The Bear, I’m going to tell you why PBW is a great investment that gives you strong exposure to the entire energy sector. You can listen to it now below.
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Safe trading,
Matt Clark
Research Analyst, Money & Markets
Matt Clark is the research analyst for Money & Markets. He’s the host of our podcast, The Bull & The Bear, as well as the Marijuana Market Update. Before joining the team, he spent 25 years as an investigative journalist and editor — covering everything from politics to business.
