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Your money: It's good to be green, but avoid the red

April 27, 2008

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If you're still riding a high from last week's Earth Day, maybe you're thinking about greening up your portfolio.

For socially conscious investors also looking to make a profit, Progressive Investor, a unit of SustainableBusiness .com, lists more than 300 publicly traded companies it identifies as environmentally friendly. While the roster includes companies operating in such green sectors as recycling, solar power and renewable energy, there are also eco-friendly businesses in the financial and food industries.

Similarly, InvestorIdeas.com offers a "Green Investing" link on its home page that includes profiles of the companies.

But if you're not careful, the wrong green stock could leave your portfolio in the red. Many of these companies are unproven, with more potential than profits. Business Week points out that even though sectors such as clean energy will flourish in the future, it may be impossible to pick which individual stocks will flourish on Wall Street. Some are fairly priced or even overpriced with little room to go higher, the magazine says.

One solution may be to pick funds or indexes that own a basket of companies, thereby minimizing risk. Among those are Claymore S&P Global Water Index (CGW), iShares Social Index Fund (DSI) and PowerShares WilderHill Clean Energy Portfolio (PBW).

BULLS AND BEARS

BULL

Deckers Outdoor (DECK)

Last: $142.76

52-week return: +85.9%

For analysts at Wedbush Morgan, it's the great Outdoors. They raised their target price to $157 from $146 after the maker of Ugg sheepskin boots and Teva sandals posted a record first quarter.

BEAR

Take-Two Interactive (TTWO)

Last: $26.20

52-week return: +33.9%

A bearish bull? A bullish bear? Citigroup's Brent Thill downgraded shares of the maker of the bloody "Grand Theft Auto" video games to "hold" from "buy" but raised his target price to $30 from $25.