So it's September, the only month of the year that over the long-run sports a negative average annual return for the S&P 500 Index. And, so far, September 2021 hasn't disappointed.
9/1 to current:
What else? Commodities, energy related in particular...
"The era-defining shift from fossil fuels to clean energy will deliver an unprecedented new boom for commodities—and an opportunity for investors—as a range of relatively obscure materials become essential to delivering emissions-free power, transport and heavy industry.
The transition could require as much as $173 trillion in energy supply and infrastructure investment over the next three decades, according to research provider BloombergNEF, and will reverberate from lithium-rich salt flats in Chile to polysilicon plants in China’s Xinjiang region.
As electric vehicles supplant gas guzzlers, and solar panels and wind turbines replace coal and oil as the world’s most important energy sources, metals like lithium, cobalt and rare earths are on the brink of rapidly accelerating demand, along with more familiar industrial materials like steel and copper."
"Though shifting demand patterns are being signposted far in advance, project developers urgently need to secure capital for new mines or production lines. Efforts to lift supplies of key raw materials—which can require years of exploration and construction—must begin now to keep pace with future requirements. That pressure could be most pronounced for EV charging infrastructure and lithium-ion batteries, which face steep growth curves, though more established solar and wind sectors have been challenged this year by pricier commodities."
"Solar panels with the power capacity of a gigawatt need about 18.5 tons of silver, 3,380 tons of polysilicon and 10,252 tons of aluminum, according to BloombergNEF estimates."
"Wind turbines and infrastructure with the power capacity of a gigawatt need about 387 tons of aluminum, 2,866 tons of copper and 154,352 tons of steel, according to BloombergNEF estimates."
"Lithium-ion batteries able to store 1 gigawatt hour of energy require about 729 tons of lithium, 1,202 tons of aluminum and 1,731 tons of copper, according to BloombergNEF estimates."
"A fast, public electric vehicle charger typically needs 25 kilograms of copper, while a smaller charger to use at home needs around 2 kilograms of copper, according to BloombergNEF estimates."
"As the energy transition supercycle gets closer, a major question is whether miners, financiers and governments can mobilize enough capital fast enough to bring on new supplies in line with demand. That means raw materials and the companies that produce them should offer higher returns—though also more risk—than component manufacturers, equipment makers or electric car producers, according to Pala’s Fung.
“It doesn't matter what battery chemistry you have, lithium is needed across all of them, and nickel is needed in many of them,” she said. “If it's solar or wind or EV charging units, you need copper to connect it all together—that’s why we like looking at these commodities.”
The world’s biggest mining firms, including BHP Group and Glencore Plc, are emphasizing their links to clean energy, while smaller competitors are surging. Lithium producers including Pilbara Minerals Ltd. and Orocobre Ltd. are advancing faster this year than battery giants like Contemporary Amperex Technology Co. and are among the top performers in the Bloomberg Electric Vehicles Total Return Index.
Still, green-focused equities have stumbled before. Valuations of solar equipment makers plunged from a 2007 peak, and lithium miners suffered more than two years of losses through early 2020 before resuming gains."
Per that last paragraph, yes, patience and diversification are always key!
I have more dialed up but this one's getting long in the tooth, and I want to keep you engaged... Saving the rest for later...Thanks for reading!