Solar Stocks Information
As technology for solar energy advances, solar stocks become a more compelling proposition. Solar stocks are issued by companies that develop or distribute this form of renewable energy. New technologies make solar products, such as solar panels, less expensive, which will help bring solar energy more to the mainstream. Investors can gain exposure to solar stocks buy trading individual shares, or through a green energy mutual fund.
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Legislation
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Government policies influence the proliferation of renewable energy, including solar power. Tax incentives and rising government spending on this form of renewable energy stands to benefit solar stocks. According to The Street website, an expected rise in government spending for renewable energy was set to trigger an increase in demand for solar makers, which stands to benefit solar stocks. In 2011, there was projected double-digit growth over a 12-month period in a group of 10 solar stocks, according to a Bloomberg survey of analysts cited in The Street.
Types
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There are different types of solar stocks from which investors can choose. Solar cell companies make the technology inside of solar products, such as panels and other equipment, that allows solar power to work and compete with traditional forms of electricity. Other solar companies make and distribute solar products to residents and businesses. Some solar stocks are emerging companies that are not large enough to trade on a major exchange, and may trade in the over-the-counter markets, which are less regulated than the major exchanges.
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Trends
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Oil stocks and solar stocks may be considered rivals in some circles, as rising oil prices tends to benefit renewable energy, including solar, but traditional oil sees benefits in investing in solar energy. In April 2011, one of Europe's largest oil corporations, Total SA, purchased a majority stake in a U.S. solar company, SunPower. Total SA paid a high premium for the solar company, and agreed to provide SunPower with $1 billion in financing to develop its business over a five-year period.
Considerations
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In 2011, when a devastating earthquake hit the nation of Japan, several nuclear reactors were ignited. Investors became fearful about the fate of nuclear energy, and solar stocks became more appealing, according to CNN Money. The uncertainty surrounding the future of nuclear power was expected to create more demand for solar, which would benefit stocks in the sector. One solar exchange traded fund, a type of mutual fund, rose 6 percent after the earthquake.
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References
Resources
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